“Danang: Affordable Land Stagnates While Apartments Soar to Hanoi-level Prices”

The Da Nang real estate market once experienced a golden era with two prominent land fever periods in 2008-2009 and 2016-2019. During these times, land was the preferred asset for investors, offering high profit margins, excellent surfing potential, and an abundant land bank.

Areas such as Nam Hoa Xuan, expanded Hoa Xuan, and those surrounding large projects along Co Co River and Vo Nguyen Giap Street became hotspots for investors. The peak was in 2018-2019, when land prices in many of these areas doubled or even tripled within a few months.

However, not long after, the Da Nang real estate market stagnated and entered a correction cycle. The impact of the Covid-19 pandemic further discouraged investors, causing capital to withdraw from land and shift to safer channels.

By 2023-2024, despite land prices in Da Nang having dropped by 20-30% from their peak, liquidity was almost frozen. Even the once-popular segments of vacation villas and condotels struggled.

This gloomy picture is further evident in the Q1/2025 market report by DKRA Consulting. Accordingly, the land segment recorded 16 primary projects introduced to the market, totaling 978 lots, a slight increase of 5% compared to the same period in 2024. Additionally, land consumption in Q1/2025 decreased by 39% compared to the previous quarter, equivalent to only 9% of the primary supply – an extremely low absorption rate.

Moreover, despite a 7% average increase in primary prices, the market did not show much positive change. Secondary prices rose by 6-9% compared to Q4/2024, but this increase was mainly concentrated in products within integrated urban areas with clear legal status and completed infrastructure – a group that accounts for a small proportion of the total land supply.

In reality, new supply remains scarce and shows no clear signs of short-term recovery. DKRA Consulting predicts that demand may slightly recover in Q2/2025, but the possibility of a boom is very low due to cautious market psychology and high primary price levels affected by input costs such as land prices, legal fees, and infrastructure.

In contrast to the land segment’s gloom, Da Nang’s apartment sector is witnessing a spectacular rise, becoming a bright spot in Central Vietnam’s real estate landscape. Since the end of 2023, apartment transactions have continuously increased, reflecting a clear shift in the investment preferences of the region’s market.

Primary price levels have also been reaching new highs. As early as Q2/2024, the average primary apartment price in Da Nang rose to 75-88 million VND/sqm, a 20% increase compared to the previous quarter. At its peak, by the end of May 2024, some luxury projects surpassed the 100-150 million VND/sqm mark, on par with Hanoi and Ho Chi Minh City apartment prices.

For instance, at The Filmore project by the Han River, a 76 sqm, 2-bedroom apartment was offered at 9 billion VND (approximately 120 million VND/sqm), while a 3-bedroom corner unit was priced at 23 billion VND. The nearby The Royal project also recorded prices reaching 129 million VND/sqm.

This price increase is not limited to the luxury segment. Reports from DKRA show that in Q1/2025, primary apartment prices commonly increased by 3-6%, while the secondary market recorded a 7-12% increase, mainly in middle-class projects in Ngu Hanh Son district, which attracts many investors due to its potential for profitable rentals.

A long-time real estate broker in Da Nang shared, “In my 10 years in this profession, I’ve never seen Da Nang apartment prices rise so sharply. Many customers from the North are surprised to find prices higher than in Hanoi and Ho Chi Minh City. Even a 2-bedroom, 65 sqm apartment in its raw state exceeds 6 billion VND, equivalent to over 100 million VND/sqm.”

This price hike effect has also created a chain reaction among developers. “Sun Group launched the Sun Solar Residence project (on Le Duan Street), with a 48 sqm apartment priced at up to 7 billion VND due to its oblique view of the Han River. Meanwhile, BRG Group is about to develop 14 apartment buildings with 4,000 units, and prices are expected to exceed 100 million VND/sqm,” the broker added.

Not only have selling prices escalated, but the rate at which brokers are snapping up inventory has also increased. Any broker without exclusive inventory is almost left out of the game.

On the other hand, this broker expressed that holding a lot of inventory leads to high initial liquidity, but there is a subsequent stagnation, and later buyers may break even or even have to cut losses. Especially, local residents of Da Nang are not willing to spend money on one-bedroom apartments priced above 3.5 billion VND. This reflects the fact that the current price hike is largely driven by investment capital from outside the region.

Mr. Ha Nghiem, Director of Batdongsan.com.vn’s Da Nang and Central Branch, observed that the interest in luxury apartments in Q1/2025 increased by 49% compared to Q1/2024 and has been consistently rising for over a year. The selling prices of luxury apartments have also grown by 36%.

He attributed the high prices of luxury apartments in Da Nang to the fact that, in the past year, the supply mainly came from projects in prime locations, with river, sea, or city center views, such as Sun Symphony, Peninsula, Filmore, and Sun Costa.

Moreover, the rise of Da Nang apartments results from several synergistic factors. First, scarce supply. From 2020 to 2022, there were almost no new apartment projects launched in Da Nang. When the market recovered, the new projects were mainly in the luxury segment, with clear legal status and prime locations.

Second, a shift in investment psychology. Previously, land was the top priority due to expectations of “surfing,” but now investors are turning to apartments to generate stable cash flow through rentals. This is especially true for apartments near the beach and tourist centers, as they offer excellent potential for short-term rentals.

Third, a wave of apartment hunting from Ho Chi Minh City and Hanoi is sweeping into Central Vietnam. As price levels in these two large cities have stabilized and there is little room for further price increases, capital is starting to flow to potential destinations like Da Nang, which boasts tourism, well-developed infrastructure, and more accessible real estate prices compared to Hanoi and Ho Chi Minh City.