According to the report of the Vietnam Association of Realtors (VARS) on the market in the second quarter of 2023, the total supply of affordable apartments has decreased by 98% compared to 2019. In terms of price, apartments with prices around 25 million VND/m2 are only available in a few commercial housing projects in areas very far from the center of centrally-run cities or in class I cities or lower.
The country recorded more than 200 housing projects for sale in the second quarter of 2023, but most of them are projects in the next phases. In terms of supply structure, the majority are still low-rise products and land plots, accounting for 53% of the total housing supply nationwide. New supply is mainly concentrated in the Southwest market, accounting for 44% of the country.
In particular, the apartment segment mainly consists of mid-range segment with prices ranging from 25 - 50 million VND/m2 and high-end segment with prices ranging from 50 - 80 million VND/m2, continuing to lead the supply of new apartments in the quarter, accounting for 53% and 34% of the total supply of apartments for sale, respectively.
Real home buyers can only choose mid-range projects in Ho Chi Minh City because there are no more affordable apartments.
In the context of the gradual scarcity of affordable housing, finding solutions to develop this product line in large urban areas such as Ho Chi Minh City has become extremely difficult. Therefore, home buyers tend to choose to buy newly developed apartments in neighboring provinces of Ho Chi Minh City such as Long An, Binh Duong, Dong Nai. Neighboring satellite provinces are becoming the target markets for many home buyers as the transport infrastructure is increasingly developed.
Grasping the market trend, many businesses are turning to the outlying provinces to develop low-cost apartment projects to serve the increasing real housing demand here. With land prices not yet being pushed up too high, it seems that these areas are quite suitable for implementing low-cost apartment projects.
Recently, a series of low-cost projects have been launched on the market, such as Ehome Southgate (Long An) with prices starting from only 1 billion VND/50m2 apartment. This project will launch more than 1,400 apartments, with 400 apartments in phase 1 already delivered to customers. This project is located on the Ho Chi Minh City - Trung Luong highway, quite convenient for traveling if you choose to live far from the city center.
Or in Binh Duong, the Legacy Prime project in the center of Thuan An City is also being sold at a price of only 1 billion VND/apartment of about 40m2, equivalent to 25 million VND/m2. It is worth mentioning that in this area, this is a price that is almost "hard to find" because most of the projects in this price range have been sold out for a long time. Many projects being opened for sale in this area are above 28 million VND/m2 such as Happy One Binh Duong (29 million VND/m2), Opal Skyline (29 million VND/m2), Opal Cityview (30 million VND/m2)...
In Dong Nai, the Fiato City project is one of the projects that many young families are looking into for their real housing needs. However, this project has a fairly high selling price compared to the above projects, with a price of about 32 million VND/m2, buyers will have to spend about 1.6 billion VND/apartment of more than 50m2. However, the selling price at this project is higher than some other affordable apartment projects in the area.
Searching for affordable apartments or social housing in provinces neighboring Ho Chi Minh City is a trend of many young families who want to own a house.
Projects with affordable prices, from about 1 - 1.5 billion VND/unit, are being welcomed by many home buyers. This is the price that helps solve the problem of buying a house for the majority of people who are in need of owning a house today. In fact, an income of about 15-20 million VND/month is the average income of most young families. Researching projects with prices higher than the above level will be beyond their ability to pay.
In addition to the price, accompanying policies such as financial support, preferential interest rates, payment extensions, etc. are the information that most people who want to buy a house are looking for. After these factors, come the factors of amenities, surrounding living environment and finally the story of long-term price increase.
This is the factor that is causing many high-rise apartment projects, a type of product that was quite unfamiliar to provincial markets just a few years ago, to become a favored segment in the shopping basket of homebuyers. Especially projects with prices ranging from affordable to mid-range, the high demand has caused a serious shortage of supply in the current phase of these segments.
As for investors, the potential of leasing out projects in the provinces at reasonable prices also attracts many people's attention. Especially when the profit rate from rental apartments in Ho Chi Minh City is getting lower and lower, the provincial market has lower input costs but better profit margins.
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