Illustration by Bao Bao.
“Over the past two years, we’ve seen a rapid and significant increase in Hanoi’s apartment market,” shared Ms. Nguyen Hoai An, Senior Director of CBRE Vietnam.
Comparing housing prices in Ho Chi Minh City and Hanoi to the income levels of their residents, CBRE found that the affordability of homes is relatively low compared to other regions.
For instance, in Kuala Lumpur, where incomes are four times higher, housing prices are relatively on par. This indicates that the ability to purchase homes in that city is much higher than in Vietnam.
“Overall, it seems that income growth has not kept up with the rising housing and apartment prices in major cities like Ho Chi Minh City and Hanoi,” said Ms. An.
According to CBRE, in the first half of 2024, Hanoi recorded a total new supply of over 10,840 apartments from 17 projects. This is also the highest supply recorded in the first half of the year since 2020 in Hanoi.
The number of apartments sold in the first half of 2024 also increased significantly, surpassing the number sold in all of 2023. In Q2/2024 alone, the number of apartments sold reached 10,170, five times more than the previous quarter and the same period last year.
Apartment projects in large urban areas in the west and east of Hanoi continued to record good sales rates. Notably, this quarter saw several projects with large numbers of units for sale (1,000-2,000 apartments) achieving sales of 80-90% of their inventory, according to CBRE.
In the primary market, the average selling price of apartments in Hanoi reached approximately VND 60 million/sq m, equivalent to USD 2,323/sq m (excluding VAT and maintenance fees). Compared to the previous quarter, prices increased by 6.5% and nearly 25% year-on-year.
Predicting future price movements, the Senior Director of CBRE Vietnam stated that both primary and secondary apartment markets in Hanoi are expected to continue their upward trajectory, with price growth exceeding 20%/year.
“This is an unprecedented figure. From 2026 onwards, this growth rate may stabilize as a new price level is established,” Ms. An added.
‘Unusual surge in prices of old apartments’
After years of hard work and saving, many families have accumulated huge sums of money. However, with soaring prices and record low interest rates, buying a home has become a challenging task for many.
Expert Analyst Reveals Factors Impacting Property Prices Decrease in Hanoi.
While the housing prices continue to rise in the inner city area with limited supply, the development of suburban housing, accompanied by synchronized transportation infrastructure, will solve the affordable housing issue.
