Sky-High Property Prices: A Daunting Reality
A recent report by a leading real estate research and consulting firm revealed that the average price of primary apartments in Hanoi has reached an astonishing 75 million VND per square meter, marking a 29% increase from the previous year. This price surge poses significant challenges for middle-income earners and those with limited budgets in their pursuit of home ownership.
Dr. Le Xuan Nghia, former Vice Chairman of the National Financial Supervisory Commission, shared his insights at a recent seminar titled “Real Estate Brokers in a New Era.” He noted that many grandiose urban areas are akin to “flowers” for the rich and “tears” for the poor.
“The poor can only shed tears when looking at these urban areas,” said Dr. Nghia. “The prices are beyond imagination and out of reach for the underprivileged. The primary reason for this situation is the lack of supply,” he emphasized.
The underprivileged can only shed tears when faced with these out-of-reach urban areas. Photo: Hoang Ha |
Further analyzing the situation, Dr. Nghia pointed out that the real estate market differs from typical commodity markets. When prices rise, many sellers refrain from cashing in, opting to wait for further price increases instead. This mismatch between supply and demand distorts the market.
According to Dr. Nghia, if timely actions had not been taken to increase the supply, the real estate market could have formed a bubble as early as 2023, persisting until the present. Left unchecked, such a scenario could have led to a potential collapse, directly impacting the banking system.
However, Dr. Nghia noted a promising development: “Thankfully, we are seeing positive signs in the past six months, with long-stalled social housing and commercial real estate projects now being unblocked.”
“Thanks to Resolution 171 of the National Assembly (on piloting the implementation of commercial housing projects through agreement on the receipt of land use rights or land use rights already arranged – PV), more than 100 projects in Hanoi have been unblocked. Our survey of four major real estate enterprises in Hanoi revealed that one company had five stalled projects, all of which have now been resolved. Another enterprise had six problematic projects, four of which have been unblocked, and the remaining two are awaiting the preparation of documents. The supply situation is expected to improve,” he added.
Anticipating the Impact of the Real Estate Transaction Center Proposal from 2026
Mr. Nguyen Van Dinh, President of the Vietnam Real Estate Brokers Association, assessed that the real estate market in 2024 experienced a prolonged period of declining liquidity, cautious market sentiment, and limited supply. However, as we move into 2025, the market is showing positive signs of recovery.
Mr. Dinh attributed this improvement to decisive government policies, increased public investment in strategic infrastructure projects, a gradual improvement in real estate supply, and streamlined administrative procedures. Additionally, new planning initiatives and administrative mergers have opened up development opportunities in emerging areas.
While there are encouraging signs, Mr. Dinh also acknowledged that challenges and obstacles remain, requiring continuous efforts to sustain the market’s recovery momentum.
Meanwhile, Ms. Tong Thi Hanh, Director of the Department of Housing and Real Estate Market Management (Ministry of Construction), shared that the Ministry of Construction and the Vietnam Real Estate Brokers Association have jointly developed a proposal for a pilot model called the “Real Estate and Land Use Rights Transaction Center Managed by the State.”
This model aims to regulate the entire process, from ensuring a sufficient supply of qualified real estate to streamlining administrative procedures and providing land use certificates to citizens.
“We will submit the proposal to the Government and report to the Politburo. If approved, we aim to submit the pilot resolution to the National Assembly session in October 2025, with the goal of having it take effect from January 1, 2026,” Ms. Hanh informed.
Nguyen Le
– 05:30 30/06/2025
