Transaction volumes vary between Hanoi and Ho Chi Minh City
JLL Vietnam’s Q2 2024 market report reveals contrasting trends in the high-end residential segment between Ho Chi Minh City and Hanoi. In Ho Chi Minh City, only 167 transactions were recorded for high-end apartments (including luxury and ultra-luxury) in the last quarter. The majority of these sales originated from the Zeit River Thu Thiem project in Thu Duc City, attributed to its attractive sales contracts.
The remaining transactions were from previous quarters’ inventory, as new supply in the high-end segment continued to decline. To stimulate demand, developers offered price discounts, extended payment deadlines, and introduced flexible payment methods.
Zeit River Thu Thiem project in Thu Duc City dominated Ho Chi Minh City’s high-end apartment supply in the last quarter.
Primary market prices for high-end apartments decreased by 4.2% from the previous quarter and 3.6% year-on-year to 4,998 USD/m2. In contrast, secondary market prices increased by 5% compared to the previous quarter and 6.4% year-on-year.
Meanwhile, Hanoi witnessed a surge in transactions for high-end apartments, with 1,722 units sold, reflecting a remarkable 60% increase from the previous quarter. This growth was driven by strong interest in subdivisions within the high-end segment located in the Vinhomes urban areas, thanks to their favorable legal framework and competitive pricing compared to similar products in the region.
“While many projects have sold out their inventory, some projects with longer pre-sale periods before handover have experienced slower sales due to buyers’ cautious approach without a clear outlook on delivery,” said Trang Le, Senior Director of Consulting and Research at JLL Vietnam.
By the end of Q2, the average price of high-end apartments in Hanoi reached 2,826 USD/m2, a slight increase of 0.6% from the previous quarter. Notably, there were no discounts offered for purchases made following the payment schedule during this quarter.
Turning to the landed housing market in Ho Chi Minh City, transactions remained modest, with only 42 units sold, mainly from the The Global City project in Thu Duc City. The subdued demand can be attributed to the dominance of inventory and buyers’ cautious sentiment.
The absence of official new supply launches in the landed housing market resulted in a limited primary supply of approximately 300 units. Price-wise, there were no significant changes, with landed housing prices in Ho Chi Minh City holding steady at 16,347 USD/m2. In the secondary market, some units were sold with lower expected profits to boost liquidity.
Hanoi’s landed housing market witnessed 225 new transactions, with Ha Dong and Thuong Tin districts becoming focal points due to their promising locations and rapid construction progress.
Hanoi’s high-end apartment market is expected to welcome 900-1,100 new units in the next two quarters.
Hanoi’s primary market prices for landed housing experienced a significant surge, reaching 9,379 USD/m2, a whopping 29% increase from the previous quarter. This drastic change can be attributed to the absence of low-priced units in the basket and the lack of a downward price trend in the supply.
What’s in store for the second half of the year?
Looking ahead, Ho Chi Minh City’s high-end apartment and landed housing markets are anticipated to introduce approximately 3,800 and 800 new units, respectively, in the second half of 2024. Demand for housing is expected to recover slowly and will likely improve when new supply shifts towards lower price segments.
Trang Le believes that the market outlook for 2024 remains subdued, with both investors and buyers maintaining a cautious approach.
In Hanoi, she predicts that around 900-1,100 new high-end apartments will be launched in the next two quarters, primarily from prominent developers such as Masterise, Capitaland, and Sunshine Group. Prices are unlikely to decrease due to the limited supply and the attractive investment potential of apartments compared to high-value landed properties.
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