Mini apartments with prices equal to commercial apartments

When asking for the price of a 50m2 mini apartment in Thanh Xuan, Mr. Huy was surprised because the owner offered 2 billion VND, an increase of 300 million VND after investing in fire prevention, equal to an average apartment.

With a savings of 1.5 billion VND, Mr. Huy, Thanh Xuan District, spent many months looking to buy an apartment but could not find one large enough to fit his budget. Seeing information about many mini apartments for sale at low prices in the district, Mr. Huy contacted a broker to go see them.

The broker offered him a mini apartment on Khuong Trung street, 48 square meters in area, with two bedrooms and two bathrooms. The initial price was 1.7 billion VND, but when he came to see the house, Mr. Huy was quoted a new price of nearly 2 billion VND (equivalent to 42 million VND per square meter). The reason was that the new owner had invested in a fire protection system and left all the furniture. If he bought this apartment, he would have a micro-contract, jointly owning the building with more than 30 other people.

Mr. Huy said the new price is "too expensive". To make up the extra 500 million VND, he needs to borrow from the bank but "the mini apartment cannot be mortgaged". Surveying some buildings with apartments for sale, he said the price range is around 1.7-2 billion VND with an area of ​​48-52 m2, equal to the price of affordable commercial apartments such as Dai Thanh and Linh Dam.

Similarly, Ms. Thuy, from Dong Da district, wants to buy a house after many years of renting. Recently, the owner of the mini apartment building she is renting announced that the contract has expired and the house will be taken back for sale. When asked for the price, Ms. Thuy was surprised because the 46 m2 apartment was offered for more than 1.7 billion VND (about 37 million VND per m2).

With the current rental price of about 7 million VND per month, the female office worker calculated 1.7 billion VND, equivalent to 20 years of renting a house. "If I buy outright, I will avoid the risk of increasing the annual rental price, and other benefits such as bank loans and mortgages are almost non-existent," Ms. Thuy shared, adding that she will look for a new rental house after the contract expires instead of buying a mini apartment.

A mini apartment with invested interior, for sale for more than 1.7 billion VND in Dong Da district.

According to VnExpress, many mini apartments in central districts are getting more expensive than before. In mini apartment buildings that have been in operation for 3-5 years, the price of an apartment ranges from 24-28 million VND per square meter. In newly built buildings, an apartment with an area of ​​46-50 square meters can cost up to 1.5-2 billion VND per unit. Previously, this type of apartment only ranged from 500 million VND to 1 billion VND per unit.

For example, at a 7-storey building in Bui Xuong Trach alley (Thanh Xuan district), apartments with an area of ​​50 m2 are advertised for 1.8 billion VND. Or at a building in Vu Tong Phan, a mini apartment with three bedrooms and an area of ​​72 m2 is offered for 2 billion VND. The apartments for sale at high prices are all invested with furniture and private transactions.

Explaining the above developments, Mr. Pham Duc Toan, General Director of EZ Property, said that the price increase of mini apartments comes in the context of a market with a shortage of affordable supply, many housing segments have "increased in price" in a short time. Typically, commercial apartments have increased sharply by 40-50% after one year and are anchored at high prices. Buyers need a budget of 3-4 billion VND to own a two-bedroom apartment in the central district.

From the increase in apartment prices, Mr. Toan observed that many types of old housing such as social housing, resettlement housing, collective housing and mini apartments have also been "pushed up" in price. Previously, with around 1 billion VND, it was very difficult for buyers to own an apartment in a commercial project or even an old collective, so they switched to mini apartments, accepting many risks.

"Currently, the price of mini apartments is equal to that of affordable commercial projects near the center, while many basic benefits are not available, so few people dare to make the trade-off," said the CEO of EZ Property.

The tightening of fire safety in mini apartments and boarding houses also increases the investment costs for the projects higher than before. According to Directive 19 of the Prime Minister , boarding houses and mini apartments that do not meet fire prevention and fighting requirements will be suspended from March 30.

Independent real estate consultant Le Quoc Kien said that to ensure operations, homeowners need to invest several hundred million VND more in fire protection systems. For example, the cost of investing in a fire protection system for a new building with a floor area of ​​about 800 m2 and 6 floors is about 700-800 million VND. This cost will be added to the rental or purchase price of each apartment by the homeowner. This explains why many apartments in newly built mini apartment buildings are "screaming" for nearly 2 billion VND.

A mini apartment building in an alley in Thanh Xuan district.

Buying and selling mini apartments carries many potential risks in terms of legality and fire safety. Mr. Kien said that buyers have to spend more than a billion VND but are not granted a pink book, sign a notarized sales contract or mortgage it to a bank. Transactions by micro-documents essentially only record this event as witnessed by a bailiff, and have no legal effect. Buyers may face the risk of disputes and losing their apartments if the building owner mortgages the entire building or takes advantage of the lack of documents to make multiple transactions.

The above situation has been common recently. At the mini apartment building in Dai Kim alley, Hoang Mai district, about 40 families have spent 700 million VND to 1.2 billion VND to buy apartments with an area of ​​33-52 m2 since 2012. Although all the apartments have been sold, the building owner still mortgaged the land use rights of the entire building to take out consumer loans, putting buyers at risk of losing their homes. Or at the apartment building in alley 236 Khuong Dinh, Thanh Xuan district, nearly 60 households had to be urgently evacuated because the first floor pillars were cracked and unsafe.

"Spending billions on a mini apartment gives buyers the feeling of owning a house, but essentially they are paying rent once for about 20 years," said Mr. Kien.

According to experts, affordable housing is the "ray of hope" to help balance housing prices, ensuring sustainable and healthy market development. Previously, in a meeting with the Central Policy and Strategy Committee at the end of February, General Secretary To Lam mentioned the establishment of a "National Housing Fund" to develop low-cost housing in large cities. In early March, Prime Minister Pham Minh Chinh also requested the Ministry of Finance to complete the establishment of this fund to mobilize resources for social housing development.

Duong Chung (According to vnexpress.net)

Source: http://baovinhphuc.com.vn/Multimedia/Images/Id/126975/Chung-cu-mini-