In Ho Chi Minh City, after a period of “hot” development, the supply of apartments has exceeded the actual demand of the people. Therefore, even though there have been very few new construction projects in the past 2-3 years, the supply of apartments in this city is still quite abundant. In Hanoi, in the past 2 years, only about 40 apartment projects have been built, while the demand from customers is increasing, so the inventory is quickly sold out. Due to the lack of supply, most transactions nowadays are resale. If a year ago, the price of apartments in Long Bien, Hoang Mai, or Nam Tu Liem districts was around 35 million VND/sqm, now it has increased to about 50 million VND/sqm.
“Currently, the demand far exceeds the supply. For those apartments that have been granted land use certificates and put into operation as utility products, buyers can live or rent them immediately, which is very safe for buyers. The sharp difference between supply and demand has led to an increase in prices for apartments in recent times,” said Mr. Nguyen Anh Tuan, Chairman of the Board of Directors of Phuong Dong Joint Stock Company.
Prices of apartments in Hanoi continue to rise. (Photo: Vietnamnet)
According to the latest data from the Batdongsan.com.vn information channel, the search volume for apartments in Hanoi is at its peak compared to 2023. The most sought-after districts are Bac Tu Liem, Nam Tu Liem, Cau Giay, and some core districts of the capital city. Although the demand from the people is very high, the sharp increase in real estate prices in a short period of time is an unusual sign. In addition to apartments, some other real estate segments are also showing signs of increasing. Dr. Vu Dinh Anh, an economist, believes that there is a speculative phenomenon. Most of these fluctuations are concentrated in places with planning or large urban development projects. In fact, although our economy is recovering, most investment channels are still difficult.
“The market is showing signs of speculation as prices of some segments such as apartments or land, and even some high-value real estate products such as villas or shophouses, are increasing rapidly. I believe that there are issues related to speculation and psychology in the real estate market,” expressed Dr. Vu Dinh Anh with concern.
Experts in the real estate sector believe that investing in real estate when prices are at this high level harbors many risks. The most concerning issue is the legal aspect of the product. When participating in transactions, buyers should thoroughly research the project and avoid depending on brokers.
“The high real estate prices have formed a new price level. Only businesses with mortgaged land lots or individuals in extreme difficulties are forced to sell at discounts to avoid bad debts. But that number does not affect the majority. Currently, real estate prices are still high and the market lacks liquidity,” analyzed economist Tran Nguyen Dan from Ho Chi Minh City University of Economics.
At present, although important laws related to the real estate market have been revised and approved by the National Assembly, the operations of real estate investment enterprises are still very difficult. Besides difficulties in accessing capital, the most important issue is the investment procedures, which are also common. According to statistics, if legal obstacles are soon resolved, about 300 projects in Hanoi and Ho Chi Minh City can be implemented soon, helping the market have more apartment supply.
Associate Professor. Dinh Trong Thinh, a lecturer at the Finance Academy, believed that the immediate solution should focus on projects and businesses with real capacity, to quickly bring real estate products to the market and contribute to the economic recovery: “The real estate market should target projects that are about to be completed and can bring products to the market. As for businesses facing difficulties, or even at risk of survival, support should come from funds in other industries instead of relying on state capital in this period.”
Currently, the Working Group of the Prime Minister on reviewing, urging, and guiding the removal of difficulties and obstacles in implementing real estate projects for localities and businesses in Hanoi, Ho Chi Minh City, and some centrally-run cities is working actively. However, to resolve difficulties for businesses, close coordination of localities, especially the two major cities of Hanoi and Ho Chi Minh City, is needed. The reality has shown that the involvement of local authorities is very important.
