Amidst the relentless rise in apartment prices, recent scenes of people jostling and pushing to secure a purchase at a Ho Chi Minh City project have exposed a troubling reality.
Manipulative Tactics Drive Prices Up
Last weekend, a viral video captured dozens of people crowding and shoving each other in a hall during a housing registration event in An Khanh Ward, Ho Chi Minh City. In the footage, a woman in a suit distributing registration forms was instantly mobbed, with people shouting and grabbing. Two women even climbed onto a table, wrestling for the green paper, believed to be the registration form. The scene descended into chaos, resembling a bustling market.
Organizers reported over 2,000 registrations for just 500 units, a 4:1 competition ratio, despite the high price of approximately VND 58 million per square meter (excluding VAT and discounts). This disparity fueled the frenzy, turning the event into a speculative scramble.
Hundreds lined up for a housing registration event last weekend. Photo: PHẠM ĐÌNH
Similar scenes unfolded at social housing and affordable housing projects, such as Bcons City in Di An (Ho Chi Minh City) and Destino Centro in Phuoc Yen (Tay Ninh), where low prices attracted crowds. Many buyers, already homeowners, sought additional purchases, even targeting social housing for resale profits. One investor revealed that early deposits with 12% discounts and historical post-handover price hikes made early investments a sure bet.
Economist Dr. Can Van Luc attributed the soaring prices to legal supply issues and speculative manipulation. A survey of 600 real estate investors found 86% planned to sell within a year, highlighting speculative intent over long-term holding.
Tran Khanh Quang, CEO of Viet An Hoa Real Estate, blamed developers for creating artificial shortages through staggered releases and enticing policies. “The 4:1 ratio at the event, while profitable, caused chaos and supply-demand imbalance,” he noted.
Regulatory Intervention Needed
Ta Trung Kien, Deputy Director of Viet A Real Estate, agreed that developers often manufacture scarcity to attract attention. “They require agents to secure 4-5 times more bookings than available units, creating artificial demand,” he explained. Additionally, phased sales with increasing prices exploit buyer regret, forcing them to pay more in later phases. Agents failing to meet targets risk penalties and reputation damage.
Deputy Minister of Construction Nguyen Van Sinh acknowledged the market’s limitations, particularly the shortage of affordable and social housing. The dominance of mid-to-high-end properties, despite high demand for low-income housing, creates bottlenecks, enabling speculation and price hikes.
Experts and businesses urge state regulators to intervene. Ta Trung Kien called for tighter supply monitoring to prevent hoarding and price manipulation. Dr. Pham Viet Thuan, Director of the Institute of Natural Resources and Environment Economics, emphasized the need for effective price controls, citing high land prices and construction costs as key drivers.
Dr. Thuan advocated stricter oversight of social and resettlement housing to prevent profiteering. He cited cases of resale profits of VND 1.2-1.8 billion per unit, highlighting regulatory gaps. “The government must expand social housing initiatives to meet genuine needs,” he urged.
Property Taxation Proposed
Dr. Can Van Luc suggested property taxation to curb speculation, citing transaction taxes, second-home taxes, and inheritance taxes used abroad. However, implementation requires clear timelines and transparent data. The lack of ownership records for second or third homes and careful tax rate calibration to avoid burdening citizens are key challenges. “Completing the database within 1-2 years is essential before taxing. Early implementation of the Real Estate Tax Law could reduce waste, speculation, and normalize prices,” he concluded.
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