Housing prices are getting more and more expensive, what is the solution to the dream of settling down?

In the first quarter of 2024, new apartment prices increased by 19% compared to the same period last year. Prices are likely to continue to rise in 2025. Housing opportunities for low-income people are therefore increasingly remote.

One difficulty after another

“Owning a new house in the center of Hanoi or Ho Chi Minh City is now only a dream for ordinary people, when many houses are now worth millions of dollars,” said Mr. Nguyen Hoang Nam, General Director of G Home, in the talk show "Formulas for successful home sales" of Dau Tu Newspaper.

Apartment prices have been continuously increasing for many consecutive quarters. Photo: Dung Minh

According to the Ho Chi Minh City Real Estate Association, if a buyer saves VND100 million each year, it will take up to 25 years to own an affordable apartment in the city. Given this situation, financial solutions from investors will be an important key for households to find a place to live. However, these solutions themselves also have many problems.

“Principal grace period and payment extension programs are not yet a comprehensive solution for home buyers. Normally, customers will have to pay in installments for 10-15 years. Meanwhile, the preferential loan period only lasts for the first 3 years. After that, the interest rate will float at a high level,” Ms. Duong Thuy Dung, Senior Director of CBRE Vietnam, shared at the talk show.

However, interest rates are not the only barrier for homebuyers. According to CBRE, the supply of apartments is decreasing. In 2023, the number of new apartments in Hanoi and Ho Chi Minh City will be only about 8,000 - 10,000 units. These numbers are only 1/4 of the pre-pandemic period.

“With scarce supply and high demand, apartment prices are constantly being pushed up. In the first quarter of 2024, primary apartment prices increased by 17% compared to the same period last year. In the secondary market, prices also increased by 19%. Even projects in good locations increased by 20-30%,” Ms. Duong Thuy Dung shared.

According to the expert’s forecast, apartment prices will continue to “heat up” in 2025, due to the limited new supply. Notably, high-end and luxury apartments will account for up to 70% of the new supply. This will make home ownership, which is already difficult, even more difficult.

The solution to settling down

According to Ms. Duong Thuy Dung, to reduce the burden of buying a house for people, many countries in the world are implementing a rent-to-own model. Thereby, instead of offering the house for sale, the investor will allow the buyer to rent it for a period of 2-3 years. After the period expires, the customer will have the right to buy the house back.

“For those who have just started working and do not have a stable job, this is an opportunity to help them have more time to accumulate credit points to borrow to buy a house. In addition, customers will also understand more about the project after 3 years of renting,” Ms. Dung shared.

Not only that, in developed countries, investors also build projects specifically for rent. These apartments often have modest area prices, even with the living room cut. In return, the project will have common spaces such as libraries, workplaces, etc. Thanks to that optimization, the rental price of these apartments is often relatively low. Many people are willing to rent long-term for 20 - 30 years.

“We should follow the world trend and consider renting a house as normal. There is no need to own many houses for our children in the future,” commented the Senior Director of CBRE Vietnam.

According to Mr. Nguyen Hoang Nam, the project of 1 million social housing units is also a solution to open up housing opportunities for many people. In particular, the new Housing Law has "untied" many conditions for buying social housing, such as relaxing requirements on household registration, increasing the minimum income level, etc.

However, Mr. Nam said that policies need to pay more attention to removing difficulties from the business side. Citing reality, the General Director of G Home said that investors who want to build social housing will have to reserve 20% of the project area for rent, and after 5 years, those apartments will be allowed to be sold. However, in reality, people are not too interested in these apartments.

“In Hanoi and Ho Chi Minh City, the rent for an apartment, without utilities, is around VND100,000/m2/month. In the provinces, it is VND30,000 - 50,000. Tenants must meet all conditions to enjoy social housing policies and must rent for at least one year. Meanwhile, apartments in commercial projects have lower rents and more flexible rental policies,” Mr. Nam compared.

Source: https://baodautu.vn/batdongsan/gia-nha-ngay-cang-dat-do-dau-la-loi-giai-cho-giac-mong-an-cu-d215621.html