Still “crazy prices”
The average price of a typical apartment in Hanoi is currently being advertised at VND 3.2 billion, at an average price of VND 45 million/m2, a 10% increase compared to the same period last year, according to data from batdongsan.com.vn.
Depending on the area, the level of interest and price increase can vary.
According to Mr. Nguyen Quoc Anh – Deputy General Director of Batdongsan.com.vn, the above price only reflects the supply-demand relationship, not yet considered “crazy prices” when a segment of customers is willing to buy at that price.
Based on Batdongsan.com.vn data, Mr. Quoc Anh said that the demand for housing is increasing day by day.
Specifically, the search for apartments in Hanoi has skyrocketed since late 2023, reaching its peak in August 2023. After that, a large number of apartments were put on sale, causing the demand to decrease sharply.
“However, a very interesting phenomenon occurred in December 2023, both Hanoi and Ho Chi Minh City saw a significant increase in the search volume. By February 2024, it was almost back to the peak of August 2023. In Hanoi, the demand is 5% higher than the supply. The supply is not enough to meet the demand, which explains why the prices are increasing so much“, Mr. Quoc Anh said.
The demand for apartments in Hanoi in February 2024 has increased by 26.2% compared to the previous month and more than 71% compared to the same period in 2023.
In the past 9 years (2015 – 2023), the profit rate for investing in apartments was 203%, land had a profit rate of 166%, stocks (203%), and gold (195%), according to Batdongsan.com.vn.
“Resistance point”
Observing the apartment market for the past 3 years, Mr. Quoc Anh believes that investors need to pay attention to the upcoming market phase, when the demand is about to reach the “resistance point” of the market.
“If the demand exceeds the search peak in August 2023, it may lead to a continuous increase in prices“, Deputy General Director of Batdongsan.com.vn said.
Referring to the VRES report analysis earlier, Mr. Quoc Anh believes that the “turning point” of the market could happen in the second or third quarter of 2024. After the turning point, the market can undergo 4 phases:
– Exploration: “It seems that the market is ‘testing the water’, when detached houses and apartments continue to lead. They are the leading type and an early market indicator”, Mr. Quoc Anh commented. It is expected that the exploration phase could take place in the third quarter or the fourth quarter.
– Consolidation: When all types of laws are put into practice, expected to take place in early 2025. The consolidation phase could fall in the fourth quarter of 2024 or the first quarter of 2025, when the laws related to the real estate market solve the market’s congestion issues and ease the money flow in the banks.
The next two phases will be “Prosperity” and “Development”.
Apartment prices continue to soar, when will young people be able to afford a house?
According to the General Statistics Office, the average income of workers in Hanoi in the third quarter of 2023 was VND 9.9 million, while in Ho Chi Minh City it was VND 9.3 million
According to calculations by Batdongsan.com.vn, even if they use all of their income to buy a house, it will take workers in Hanoi and Ho Chi Minh City about 26 years to own an apartment.
“In the future, when urban areas expand, when expressways are built to facilitate people to live far away, then housing prices in that area can decrease. But if we continue to focus on the core area, it will be very difficult to reduce prices, and even the prices may still continue to rise“, Deputy General Director of Batdongsan.com.vn said.
