Hanoi (VNA) – The number of new apartments in Hanoi in the third quarter of 2024 shot up 95% quarter-on-quarter and 178% year-on-year, reaching nearly 5,300 units, and prices remain high, according to a report by property consultancy firm Savills Vietnam.
Unfortunately, the majority of the apartments that are coming out of reach for many as they entered the high-end segment, while affordable apartments were essentially “absent”, it said.
Data from Savills showed that apartments priced at 4 billion VND (160,950 USD) or more accounted for 70% of the number of those sold in the first nine months of 2024, a sharp increase from 2% in 2020. Apartments priced below 2 billion VND made up only 1% of the market share. Meanwhile, transactions of products priced at 2 - 4 billion VND accounted for 29%. The figures reflect a gap in housing supply for low- and middle-income earners.
Given escalating housing prices, Do Thu Hang, Senior Director of Advisory Services at Savills Hanoi, said that the shortage of affordable apartments is unlikely to improve in the short term.
According to the Savills report, apartment prices in the primary market in the city soared to 69 million VND per sq.m in the third quarter of this year, an increase of 6% over the previous quarter and 28% against the same period last year, affecting the new apartment market. Similarly, prices of old apartments reached 51 million VND per sq.m, up 10% quarter-on-quarter and 41% year-on-year.
Nguyen Van Dinh, Chairman of the Vietnam Association of Real Estate Brokers (VARS), said the limited supply is one of the main reasons pushing up real estate prices.
Hanoi is expected to see 9,700 new units launched in the fourth quarter, with 88% from large-scaled projects, Savills said, adding that from 2025, over 110,000 units from 106 projects are anticipated to enter the market, but the shortage of affordable units will remain an outstanding problem.
Nguyen Quoc Anh, Deputy General Director of Batdongsan.com.vn, held that that apartment prices in Hanoi will continue to increase slightly due to the supply shortage.
To solve difficulties, insiders say that there should be close coordination between State agencies and stakeholders in the real estate sector. Measures to control land prices and construction costs are needed, along with creating favourable conditions for new commercial housing projects. This is especially the case for those that are affordable, to help reduce pressure on the market as well as ensure sustainable development of the real estate market./.
