Land funds are increasingly scarce, making it difficult to build affordable housing

Bảo Chương |

HCMC - Input costs for real estate project development have increased, especially land costs, making the goal of building affordable housing far away.

The Vietnam real estate market research report for the first quarter of 2025 by Avison Young Vietnam shows that apartment prices on the market from newly opened projects and secondary supply in Ho Chi Minh City continue to increase strongly.

The supply and demand of the first quarter of 2025 come from the remaining products after the year -end opening of Eaton Park projects (Gamuda Land) and The Opus One (Samty). The market also recorded supply from the Masteri Grand View project (Masterise Homes) with about 616 apartments, located in The Global City (Thu Duc City).

In the last quarter, The Infiniti project (Keppel Land) in District 7 promised to provide the market with about 801 apartments. In early 2025, the project will complete the construction of the first tower in 4 buildings, expected to be handed over in the fourth quarter of 2025.

A report by Avison Young Vietnam shows that in the first quarter of 2025, the market recorded an average increase of 6% in apartment prices in the primary market compared to the previous quarter, reaching 3,200 - 5,200 USD/m2. Notable with the Eaton Park project priced at 5,700 USD/m2 and Masteri Grand View priced at about 5,300 USD/m2.

In particular, projects along metro line No. 1 have had a significant change in secondary selling prices, typically the Gateway Thao Dien project (Son Kim Land) from 3,400 USD/m2 in early 2024 to 4,100 USD/m2 at present, an increase of 20%. Or the Lumiere Riverside project (Masterise Homes) has an average price of 4,650 USD/m2, an increase of 20.7% compared to 2024. In the current context, finding an apartment with a price of less than 2 billion VND in Ho Chi Minh City is extremely difficult

In reality, if before 2018, the supply of apartments priced at 1.5 billion VND/unit in Ho Chi Minh City was quite abundant, then in 2019, the time of the stress of project legal bottlenecks, the apartments above and below 2 billion VND had disappeared from the market. Even many projects that have been opened for sale before have had quite strong price adjustments compared to when launching a new basket of products.

The view given by investors on the story of continuously increasing selling prices is that it is very difficult to implement affordable commercial housing projects in the current period. Project development costs are escalating, land funds are increasingly expensive and scarce...

Therefore, instead of building low-cost housing, investors have pre-positioned the high-end segment, because they also put in that effort, but building high-end projects brings better economic efficiency. If they want to easily sell to many subjects, the investor will adjust the design in the direction of reducing the apartment area to reduce the total amount of money spent by customers.

In a recent meeting with investors at the general meeting of shareholders, many leaders of large real estate corporations when asked about the story of developing a supply of affordable housing to increase liquidity also commented that it was very difficult.

Because, when the real estate market recovers, the story of finding clean land to balance the cost problem and project development will be a "hot" issue. In the context of high project implementation costs, to suit the long-term orientation, many investors have shifted to areas near Ho Chi Minh City such as Binh Duong, Long An, Dong Nai, Ba Ria - Vung Tau... where land funds are still abundant and prices are also "softer".

However, in the coming time, the formula for calculating land use fees applied according to the new price list will increase land costs, clean land funds in satellite areas, so it is increasingly scarce and expensive. This land fund is expected to be sought after more, so clean land prices will no longer be as accessible as before.

Bảo Chương
TIN LIÊN QUAN

Ho Chi Minh City prioritizes improving the supply of affordable housing

|

HCMC - Many forecasts show that in 2025, the supply of low-cost, affordable housing will continue to be scarce.

Improving affordable housing supply is a difficult problem

|

Falling real estate prices and increasing affordable housing projects are a difficult problem for investors in the current context.

HCMC has a headache solving the problem of affordable housing

|

Commercial housing investors all want to sell at low prices to boost product consumption, but this is not possible at this stage.

Affordable housing is getting harder to make

|

HCMC - In the context of increasing input costs for project development, building affordable housing is increasingly difficult.

Suspicion of illegal rocks on Hon Cha Mountain flooding into businesses

|

Binh Dinh - Although the exploitation and transportation of stone on Hon Cha Mountain has been strictly prohibited, dump trucks still brazenly carry stone out of the mountain and bring it to businesses.

Hanoi announces the rate of public 10th grade entrance exams in 2025

|

The number of students registered to enter grade 10 in Hanoi's public high schools in the 2025-2026 school year will reach 266,939.

Big fire at a paper factory in Nam Tu Liem, smoke column covers the entire area

|

Hanoi A major fire suddenly broke out on the afternoon of May 13, in the area of Phuc Dien Street, Tay Mo Ward (Nam Tu Liem District), causing many people to panic.

Infrastructure is not yet complete, resettlement quotas in Ben Tre have been publicly advertised for sale online

|

Ben Tre - Information appeared on social networks about selling resettlement quotas at the emergency resettlement project for migrants due to landslides on the Ben Tre river bank.

Ho Chi Minh City prioritizes improving the supply of affordable housing

Bảo Chương |

HCMC - Many forecasts show that in 2025, the supply of low-cost, affordable housing will continue to be scarce.

Improving affordable housing supply is a difficult problem

Bảo Chương |

Falling real estate prices and increasing affordable housing projects are a difficult problem for investors in the current context.

HCMC has a headache solving the problem of affordable housing

Bảo Chương |

Commercial housing investors all want to sell at low prices to boost product consumption, but this is not possible at this stage.

Affordable housing is getting harder to make

Bảo Chương |

HCMC - In the context of increasing input costs for project development, building affordable housing is increasingly difficult.