HCM City (VNS/VNA) - 2025 will serve as a crucial foundation year for the real estate sector in Ho Chi Minh City, marking the path towards a full recovery by 2026 after facing challenges caused by COVID-19 and economic recession, experts predicted.
The market saw its most difficult period in 2023, but now there are promising signs with many projects resuming, developers launching new projects, and investors showing readiness to re-enter the market.
According to a report from the HCM City Real-Estate Association (HoREA), the real estate market experienced negative growth throughout 2023 until the first quarter of last year, with a 0.5% decline. However, there was a significant acceleration starting from the second quarter of 2024, resulting in 9% growth for the entire year.
Although admitting that there are many positive signals, Le Hoang Chau, chairman of HoREA, anticipates that this year the market will continue to face challenges, particularly regarding low supply, especially in the housing segment priced under 30 million VND per square meter, as well as social housing.
While a strong recovery is not expected for this year, experts highlight the importance of 2025 as the Government and relevant authorities focus on resolving legal issues faced by projects and introduce more products to the market. As supply increases, prices are expected to gradually rise, making home buying more accessible to a larger population.
Market research companies CBRE and JLL forecast an improvement in housing supply for HCM City in the 2025-26 period.
According to CBRE, in 2025, the city is expected to add 8,000-9,000 housing units, and in 2026, the city will have around 11,000 more apartments.
According to another researcher, JLL, about 6,000-7,000 high-end apartments and 4,000 ready-built landed units are expected in the forth quarter of 2024 to 2025. Following the official implementation of new legislation from last August, project resumption and new launches are expected, yet no rapid changes are expected in the short term.
End-users, which typically favour low- to mid-priced projects with clear legal status, will continue to be a key demand driver over the next year. Despite higher prices expected in new projects, developers are likely to offer incentives to stimulate buyer interest.
Dinh Minh Tuan, from the HCM City branch of batdongsan.com.vn, said that the central area of the city continues to attract attention.
For the outskirts, new metro lines and road infrastructure will contribute to changing the urban landscape, leading to good growth. Apartments will be the most popular type of property with the potential for faster price increases, while land plots will recover after a period, likely by the end of 2025 at the earliest.
"Cash flow is beginning to seek opportunities in the southern market, with demand increasing by about 28%. In the new housing market of HCM City, only two segments show early signs of recovery: the apartment and private house segments," Tuan was quoted in a report on VOV.
Tran Hoang Quan, director of the HCM City Department of Construction, stated that in 2024, a number of new projects were approved for investment and some old projects were restarted due to legal issues being resolved.
By the end of 2024, HCM City had removed difficulties for 34 out of 64 real estate projects. Of this total, 12 projects have had their obstacles resolved or no longer have pending issues, while 17 projects are awaiting conclusions or handling by inspection and examination agencies. In addition, 30 projects require ongoing monitoring and resolution.
From the beginning of the year until December 15 of 2024, the city approved investment proposals for 17 residential projects and construction permits for four housing projects.
"Twenty projects are still under the city's direction to continue clearing obstacles for implementation. This is a boost for the real estate market's development in the future. After negative growth in 2023, there are signs of returning to positive growth. It is forecasted that the market will recover at the beginning of 2025, but it will be slow, and new supply will gradually be added to the transaction volume," said Quan.
The apartment segment is still considered the most promising due to slow supply growth and high demand. New policies on land, housing, real estate, and credit effective from August 1, 2024 will have a positive impact on the market in the near future. Prices may slightly increase in some segments due to the adjustment of the new land price list in the city.
In the coming period, the city will continue to review and adjust construction and urban planning to suit the actual situation; improve and streamline investment procedures, while researching tax solutions to ensure fairness in access to housing./.
VNA
