Construction of a property project that has been stalled for years in HCM City’s downtown District 1. (Photo: VNA) According to the 2023 Asia Pacific Home Attainability Index, HCM City is the second least affordable in the region with the highest median home price in Vietnam at 296,000 USD (compared with 214,000 USD in Da Nang and 182,000 USD in Hanoi).
Da Nang housing is the fourth least affordable with a median home price at 26.7 times the median annual household income.
Although HCM City has a slightly larger population than Hanoi, about 35% less new housing has been completed in the city since 2010 than in Hanoi, the report said.
In addition to the relatively limited new supply of housing, the larger unit size in HCM City contributes to its higher median home price. It has a median home size of 83 sqm versus 65 sqm for Hanoi, it said.
These two factors explain the significantly higher ratio of median home price to median annual household income of 32.5 for HCM City compared with 18.3 for Hanoi, it added.
Many home buyers in HCM City are speculative investors who own multiple units, further pushing up prices, according to the report.
Shenzhen in mainland China is the lowest in terms of home attainability with the highest median home prices at 35 times median household income, it noted.
“Homeownership is considered unaffordable when the ratio of the median home price to median annual household income exceeds five,” according to the report.
By this standard, only Singapore’s Housing Development Board (HDB) units and apartment units in Australia’s Melbourne and Brisbane are considered affordable.
According to the report, homeownership is ‘severely challenged’ in HCM City and Da Nang (Vietnam); Shenzhen (mainland China); Hong Kong (China); Manila and Cebu (the Philippines) with median home prices at around 20 to 35 times the median household income.
No longer the most expensive in Asia Pacific, Hong Kong’s home price ranks second, behind Singapore whose median price is 1.2 million USD.
However, Singapore housing is ‘deemed most attainable with the median price of units at 4.7 times the median household income’, the report said.
Singapore also has the highest homeownership rate at nearly 90%, thanks to the government’s consistent affordable housing policy.
Compared to home ownership, home rentals are deemed more attainable with monthly rent for most cities at below 30% of median household income with cities in Japan and the Republic of Korea having the lowest ratio of monthly rent to income.
The report surveyed a total of 45 cities in nine countries in the Asia Pacific region with a combined population of 3.5 billion or 45% of the world’s population.
The key findings are based on analysis of data, relevant publications and interviews conducted with housing experts in the region, among others./.
VNA
