Illustrative image
The ability to own property long-term and expand usable space makes real estate a sought-after segment. However, land prices have surged rapidly in a short period, even for houses in alleys and narrow lanes; their prices have increased significantly just a few months after the last inquiry.
According to a survey of several brokers in Hanoi, real estate prices typically increase by 3-5% annually. However, in the past six months, the prices of houses in alleys have risen much higher than in previous years, exceeding 10%, and even 20% in some cases. Notably, this trend is not limited to alleys in inner districts such as Dong Da, Hai Ba Trung, and Thanh Xuan but also in suburban districts like Long Bien and Ha Dong.
For example, a 30-square-meter house in Phuc Loi, Long Bien, is listed for sale at 4.25 billion VND, equivalent to more than 140 million VND per square meter. This price is nearly 50% higher than a year ago (according to a survey by Batdongsan.com.vn)
Market research units attribute this price increase to various reasons, including the momentum from other real estate types such as villas, townhouses, shophouses, and apartments, which have been on an upward trajectory.
Notably, one of the reasons for the price increase in alley houses is the new regulation that took effect on October 7, 2024. According to this regulation, after subdivision, residential land plots in wards and towns in Hanoi must have a minimum area of 50 square meters, up from the previous 30 square meters. As a result, smaller houses in alleys with reasonable total costs have become scarcer, making them more affordable for many buyers.
Mr. Le Viet Long, Director of the Resource Center at RECO Home, shared his insights: “Previously, a land plot of only 30 square meters could be a separate lot, but now it has to be 50 square meters. As a result, houses in alleys ranging from 30 to 50 square meters have become a rarity and will no longer be available in the market. These properties are particularly suitable for the financial situation of most buyers today, especially those with a size of 30-50 square meters, which have seen significant price increases.”
Another factor contributing to the price increase is that alley houses have become a popular choice for small business owners due to the growth of e-commerce, eliminating the need for a storefront on the main street. However, Mr. Long cautioned that some brokers might collude with homeowners to increase the selling price to earn higher fees or invest in driving up market prices.
Previously discussing this issue, Mr. Pham Duc Toan, CEO of EZ Property, mentioned that with the increased minimum area for subdivision, people would need to invest more time and capital to acquire a sufficiently large plot of land. Consequently, the prices of the subdivided and partitioned land plots would also increase.
A 30-square-meter house in an alley in the center is currently priced at about 4-5 billion VND, but if the subdivision area is increased to 50 square meters, the value rises to around 7-8 billion VND. This amount limits the accessibility for many, catering only to a specific group of buyers. Not to mention, 30-40 square meter plots are favored by many due to their affordability and the possibility of adding more floors to increase usable space, explained Mr. Toan.
However, from a planning perspective, Mr. Toan agreed with the new subdivision regulation as it would help prevent extremely small houses from detracting from the urban landscape and hindering fire prevention and fighting efforts.
The Real Estate Shark’s Hunt for Untapped Terrains
As Hanoi becomes increasingly congested and property prices soar, large investors – often referred to as real estate ‘sharks’ – are on the lookout for new potential territories. They are expanding their horizons!
The Continental: Six Signature Values that Define Our Prestige
With a visionary take on crafting an elite living space, The Continental brings the vibrancy of a global destination to the ancient Loa heritage site. This project pioneers a new standard of distinctive living, asserting its leadership in the real estate market.
The Periphery Project’s One-Year Delay: Still a Mixed Bag
In a bid to expedite the process of land clearance for the Ring Road 4 – Capital Region (Ring Road 4) project, the Chairman of the Hanoi People’s Committee had set a deadline of December 31, 2023, for districts with the project passing through to complete the task. However, as of December 2024, a year later than the initial deadline, the construction site for the Ring Road 4 project remains a patchwork of cleared and uncleared land, hindering the project’s progress.
The Chairman’s Apology: Fast-tracking Hanoi’s Detailed Planning for Old Apartment Renovations
The Hanoi People’s Committee has instructed districts to submit detailed plans for the renovation of six residential areas: Thanh Cong, Ngoc Khanh, Giang Vo, Thanh Xuan Bac, Thanh Xuan Nam, and Nghia Tan. The deadline for submitting these plans is set for December 2024.
The Ultimate Guide to Real Estate: Navigating the Hanoi Property Market with Confidence
The Department of Construction will remove unqualified units from its electronic information portal and report them to the Ministry of Construction to be taken down from the housing and real estate market information system.
