High rent prices make tenants 'disappointed'

Ms. Tran Thi Lan Anh (Binh Thanh, Ho Chi Minh City) said that she had just sat down with the landlord to negotiate the notice of increasing the rent by 2 million VND/month from July 2023.

“ My husband and I moved to this 1-bedroom apartment at the beginning of 2021. The pandemic affected our income, so the landlord reduced the rent by 30%. By July 2022, the rent returned to normal at 8 million VND/month. After a year, in the new contract, the landlord wanted to increase the rent by 2 million VND, which shocked me, ” said Ms. Lan Anh.

Similarly, Mr. Bui Tuan Linh (Ha Dong, Hanoi) also said that at the end of May, his family received a notice from a broker that the landlord intended to increase the rent by 1.5 million VND/month.

The couple's highest income is only about 30 million VND/month, of which the rental cost is 5 million VND. Now, an increase of 1.5 million VND means that the monthly financial resource of Mr. Linh's family will only be more than 20 million VND. In addition to the living expenses for the family of 4, which are increasing every day, Mr. Linh is also trying to save money to buy a house to settle down.

“ The increase in rental prices has reduced our savings, while there are many unexpected expenses that cannot be accurately estimated. It will be difficult to afford a house like this ,” said Linh.

High rent prices, tenants 'disappointed' - 1 — Apartment rental prices in Hanoi and Ho Chi Minh City have been on the rise recently. (Illustration photo)

A survey in Hanoi shows that apartment rental prices have been on the rise recently, especially in districts near or in the center. The common increase is about 1-2 million VND/apartment/month, equivalent to an increase of 10-20% compared to early 2022.

For example, some apartments on Nguyen Co Thach Street (Nam Tu Liem) have increased in rent from 7-8 million VND/month to 9-10 million VND/month (3-bedroom apartment). In apartments such as Vinhome Smart City (Dai Mo), The Pride (To Huu), Greenbay Me Tri (Nam Tu Liem), Sky City Lang Ha... the rent has increased from 1 to 3 million VND/month.

In Ho Chi Minh City, a survey by the Vietnam Association of Real Estate Brokers (VARS) showed that over 70% of apartment lease contracts that recently expired (the usual term is one year) were re-signed with an average price increase of 10-20% or more.

Data from Batdongsan.com.vn also confirms this trend. Specifically, in the first months of the year, in Hanoi, apartment rental prices increased by 8% compared to 2022. According to the survey, the average rental price is currently around 13 million VND/month. The demand for renting apartments and boarding houses also leads the market with the number of rental searches increasing by 112% and 38%, respectively.

The average rental price of apartments in Ho Chi Minh City is 4%. Apartments are also the type of property with the most interest (up 157%) and next is boarding houses (up 107%).

The reason why rental prices are constantly climbing, according to experts, is because home prices are constantly rising, so renting is the solution chosen by many people.

Mr. Dinh Minh Tuan, Director of Batdongsan.com.vn in the Southern region, analyzed that many customers do not have enough money to buy a house so they will rent, or some groups rent and then sublet to serve domestic tourism.

In addition, some units will reduce their working model in 2022, and return to the market in 2023, renting small areas of 50 - 70 m2 in the centers to work.

On the other hand, the increasing trend of urbanization and the large number of immigrants to the city center have led to an increase in the demand for renting apartments and boarding houses; the rental market has become more vibrant than before.

Mr. Nguyen Quoc Anh, Deputy General Director of Batdongsan.com, also believes that increased demand will lead to increased rental prices. If the supply of new projects remains scarce, causing home prices to increase, people will tend to wait and see, switching from buying to renting more.

Ngoc Vy

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