The Vietnam Real Estate Brokers Association’s real estate market report reveals notable insights into the rising prices of real estate properties. In the second quarter, primary residential property prices continued their upward trajectory, with most new supply being completed and positioned at a higher standard. Some mid-range apartment projects also witnessed price hikes of 3-5% due to the scarcity of supply in this segment.
According to the Association’s data, apartment prices in Hanoi, Ho Chi Minh City, and Danang in Q2/2024 surged by 58%, 27%, and 45%, respectively, compared to 2019.
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A survey of the market also reveals increasing apartment prices. Mr. Nguyen Duy Tri, a resident of Dong Da, Hanoi, shared that he profited VND 200 million within a few months of investing in an apartment. In December 2023, Mr. Tri purchased an apartment in Linh Dam, Hoang Mai, Hanoi, with the intention of “surfing the market.” The 60m2 apartment was priced at VND 2.3 billion at the time of purchase. However, by May 2024, brokers were offering to buy the apartment for VND 2.5 billion, and now they are willing to pay VND 2.6 billion.
At the seminar “Investment Focus in the New Context,” Mr. Dang Truong Giang, Deputy General Director of Mai Viet Land, shared: “From 2014 to the present, the value of apartments has continuously increased rapidly. According to CBRE, apartment prices increase by 13-15% annually. Until now, the apartment segment has not shown any signs of cooling down.”
According to Mr. Giang, to clarify whether the current situation of rising apartment prices is abnormal, we must consider multiple factors. Typically, bubbles form due to supply and demand dynamics, with investment demand outpacing actual housing needs, price factors, monetary policies, and capital sources.
In reality, according to a survey by batdongsan.com.vn, the supply of apartments is extremely limited. For example, in Hanoi, despite continuous increases in supply, it still fails to keep up with the demand of the population. In other words, I believe that the shortage of supply is a significant reason for the increase in apartment prices, which is not necessarily abnormal. Along with the price increase, the demand for real estate purchases has also grown strongly, with a total search volume increase of more than 10%.
According to Mr. Nguyen Dung Minh, Deputy General Director of MIKGroup, in the coming time, I expect new laws to create opportunities for large investors with large-scale projects that bring real value to society. In the last five years, large-scale projects such as Vinhomes Smart City, Ocean, and Ecopark have created significant added value. For instance, Smart City Tay Mo, which was priced at only VND 30 million/m2 four years ago, now stands at VND 80-90 million/m2. This does not indicate an overheated market but demonstrates the value created by well-invested, well-planned, and well-infrastructured projects.
Mr. Minh mentioned that short-term issues, such as limited supply, are among the factors influencing selling prices. From now until the end of this year and the beginning of next year, the average selling price is expected to climb even higher.
How to reduce the price of an apartment in English + any grammar tool code?
The prices of condominiums have become excessively high, making it impossible for those who genuinely need housing to afford them. In order to improve accessibility, it is imperative to decrease the prices of condominiums by diversifying the products and increasing the supply of social housing.
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