Along with the development of a series of apartment complexes, many social housing projects are also being invested in, contributing to the slight decrease in apartment prices in Hanoi. Although the decrease is not significant, it has partly shown that the market is tending to approach real value.
There are three main reasons for the decline in apartment prices. Firstly, the supply is being strongly supplemented. In Hanoi alone, the city has approved 148 projects with a total scale of over 800 hectares under the pilot form of commercial housing through land use rights agreements.
Second, promoting the renovation of old apartment buildings will also create a relatively large supply, especially when projects are allowed to increase floors.
Third, many social housing projects are being accelerated, while investment attraction policies are increasingly superior.
With a price of only about 1316 million VND/m2, social housing is currently up to 60% cheaper than commercial housing, opening up housing opportunities for tens of thousands of people with average and low incomes - a group of capital that has been " put on the sidelines" of the market for many years.
Hanoi's acceleration of the construction and opening of social housing projects is the right step, especially in the context of increasing demand for housing in the mid-low segment. Meanwhile, commercial apartment prices in equivalent areas range from 3550 million VND/m2, or even higher. This difference clearly reflects the imbalance between supply and demand between the two main segments.
Despite creating indirect competitive pressure, social housing is not strong enough to cause commercial housing prices to drop sharply. For the real estate market to develop sustainably, it is necessary to solve the overall problem - from credit policy, legality, planning to the development of diverse products, meeting many population groups.
Mr. Do Van Thach - Director of Dova Land - said that after a long period of price increases, the apartment market, especially secondary apartments, has recorded a downward adjustment trend. Currently, the average price on the market is about 60 million VND/m2.
According to Mr. Thach, after a period of strong increases, housing prices are currently moving sideways in many areas, and in some places, they have even begun to decrease slightly. It is forecasted that from now until the end of 2025, apartment prices in Hanoi may decrease by 10 30% compared to the peak in the fourth quarter of 2024, depending on location. The Ring Road 2 area is likely to keep prices, while from Ring Road 3 and above, prices tend to decrease thanks to the appearance of many social housing projects - factors that help expand urban areas and stabilize housing prices.
Speaking to Lao Dong Newspaper reporter, Mr. Nguyen The Diep - Vice President of Hanoi Real Estate Club - commented that when the supply of social housing increases, the commercial housing market will certainly be under pressure to reduce prices, because people tend to shift their demand.
Mr. Diep also explained the reason why social housing prices are still not as low as expected, stemming from high infrastructure costs, management and operation, interest rates and construction material prices. However, this price is still significantly lower than that of commercial housing. Therefore, localities need to proactively arrange clean land funds and invest in synchronous infrastructure to reduce costs and selling prices, creating opportunities for a large number of people to own houses.
"However, to attract people, there needs to be a specific legal framework for investors, and at the same time, there must be investment in technical infrastructure - it cannot be just building houses. Building social housing also requires quality assurance, because currently the standards of materials and supplies are still low, Mr. Diep emphasized.
