Transactions are stagnant but the selling price of Hanoi apartments is still increasing like "possessed"

(Dan Tri) - Experts say that the continuous increase in apartment prices has caused people to temporarily suspend their purchase plans. However, apartment prices continue to increase despite difficulties in transactions.

Homebuyers struggling amid price storm

According to a survey by Dan Tri reporters, over the past month, the selling price of apartments in Hanoi has continued to maintain an upward trend.

A 64m2 house with 2 bedrooms at Vinhomes Smart City project was put up for sale in mid-October for about 4.2 billion VND. Up to now, this apartment has continued to increase in price to 4.6 billion VND.

Or at the Thang Long Number 1 project, an 87m2 apartment with 2 bedrooms was advertised for sale at the beginning of October for 5.7 billion VND. However, the price of this apartment has now been increased to 6 billion VND.

According to data from a research unit, the average selling price of primary apartments in the entire Hanoi market has increased significantly, from 40 million VND/m2 in early 2022 to about 72 million VND/m2 in the third quarter of this year.

In particular, the average price of newly opened projects in this quarter reached about 70 million VND/m2 (excluding VAT and maintenance fees), because the supply of newly opened apartments in the quarter was mainly recorded as high-end and luxury segments, accounting for 100% of the market share.

In need of buying a house, Mr. Nguyen Van Ngu (from Nam Dinh) said that for the past 3 months, his family has been continuously looking at many apartments in Nam Tu Liem and Ha Dong districts. With 3 billion VND, Mr. Ngu plans to buy an apartment of about 65-70m2, designed with 2 bedrooms, but the more he looks, the more he feels like he is trapped in a "matrix of apartment prices".

"The same unsold apartment, but the price the owner offers is even higher than before. For example, a 68m2 house in My Dinh (Nam Tu Liem, Hanoi) was offered for sale in September for about 3.3 billion VND. The same house is now being offered for sale for 3.7 billion VND," he said. While the apartment prices are constantly "dancing", Mr. Ngu has temporarily suspended his plan to buy a house and is waiting for the price to cool down.

Or like Mr. Tran Van Cuong (from Bac Giang) said, for the past 2 months his family has gone to see houses at many apartment projects in Hanoi. However, Mr. Cuong was shocked because the selling price of the apartment given by the owner is getting higher and higher quickly.

Some people have stopped their plans to buy a house because the asking price has increased rapidly (Illustration: Tran Khang).

10 days ago, Mr. Cuong was quoted by the owner of an apartment in Hoang Mai district (Hanoi) with an area of ​​72m2, designed with 2 bedrooms, for 4.3 billion VND, equivalent to 60 million VND/m2. However, recently, the owner of this apartment informed Mr. Cuong that the price had increased to 4.7 billion VND.

"The rapid increase in apartment prices has me wondering whether I should buy now or wait for it to stabilize. If I buy now, the price might go down again, because it has already increased so much before. If I don't buy, I'm afraid that apartment prices will continue to increase," he said.

According to data from a market research unit, the average selling price of apartments nationwide in the first quarter of 2021 was 35 million VND/m2. By the third quarter of 2024, the selling price had increased to 51 million VND/m2. Thus, in 4 years, apartment prices have increased by 45%, or more than 10% per year.

Why are apartment prices "hot"?

Real estate expert Nguyen Quoc Anh said that there are many reasons leading to the hot price increase of the apartment segment.

First, the real estate market is cyclical. Specifically, apartment prices are increasing due to the nature of the market being in the recovery phase. Previously, in mid-2024, this unit predicted the recovery of each type of real estate, in which the first type to recover will be residential products.

After going through a difficult period, the psychology of investors in the real estate market is very weak. The most fearful thing when investing is not the decrease in real estate prices but the fear of the product being illiquid. Therefore, investors are now looking for types of properties with certain legal status, cash flow, and at least can be rented out like apartments.

The second reason is that supply has not met market demand, while demand is very high. For example, in Hanoi, each year about 100,000-170,000 new apartments are needed, while the supply from the beginning of the year only meets about 30,000 units, and in 2023 about 10,000 units.

At the same time, the population density of urban areas is very large. Some countries such as Korea, China, ... although have good transportation systems, convenient to travel to all provinces and cities, people still mainly live and work in big cities. Vietnam is no exception. Buying a house in big cities has never been easy. As people become more concentrated, the price level is very difficult to decrease.

In addition, real estate products are increasingly concentrated in high-priced segments. Evidence is that in early 2020, the high-end segment and above (priced at over VND55 million/m2) only accounted for about 6% of total supply. By the third quarter of this year, these products accounted for about 60%.

According to the expert, in the context of low supply in the market, after removing legal issues and launching products, investors mainly focus on the mid-range segment and above (prices above 35 million VND/m2).

"It takes a long time to launch a project, while land prices continue to increase every day, so it is logical for investors to decide to launch apartments at mid-range prices and above," said Mr. Quoc Anh.

An apartment building in Hanoi (Photo: Duong Tam).

The third reason is the psychological factor of the market. Specifically, when the price of apartments has not increased much, people tend to wait for the price to decrease. But when they see the price increase by about 10-20%, everyone rushes to buy because they are afraid that the price will continue to increase. This adds a psychological blow, causing the market to rebound.

"In fact, the market has been very hot for the past year. Thus, the reason also comes from the fact that people are quite impatient after waiting for apartment prices to drop," Mr. Quoc Anh concluded.

Nguyen Van Dinh - Chairman of the Vietnam Association of Realtors (VARS) - assessed that the recent period has seen unusual increases in apartment prices, especially in Hanoi. This phenomenon is certainly influenced by interest groups while the economic context, market and people's income have not yet recovered.

"House prices are rising, but there are no transactions. This could be a trick by an investment group with unclear intentions," Mr. Dinh said frankly.

According to him, these interest groups are able to carry out price-inflating tricks based on the fact that the supply of apartments is problematic. In recent years, the market has not had any new projects approved for investment licenses. Projects on the market are mainly old projects and are bought and sold again. The supply is both lacking and of poor quality, the supply for people and low-income people is very little, and the product structure is not suitable.

In addition, most of the new supply continues to be completed at a high standard with high investment costs and land costs, and investors also expect higher profits than before. Therefore, the price level of primary apartments is very difficult to decrease. The high price of apartments in the primary market has led to a sudden increase in prices in the secondary market.

Currently, the psychology of home buyers has gradually decreased as apartment prices have continuously increased since the beginning of the year.

Apartment transactions have slowed down but are expected to be difficult to decrease in the short term (Photo: Tran Khang).

Mr. Pham Duc Toan - General Director of EZ Property - said that recently, apartment prices have only been hot locally in Hanoi due to the difference between supply and demand. Up to now, apartment prices in Hanoi have exceeded the peak.

"I have a group of friends who are all high-income earners, but looking at current apartment prices, they all think they are too high, not commensurate with the value, and very difficult to access," he said.

Apartment prices are too high, so many people have put off their plans to buy a house, thinking that the prices are not reasonable. Therefore, the liquidity of apartments has been very low recently. Mr. Toan predicts that from now until the end of the year, apartment prices will hardly increase further. However, it will also be very difficult for apartment prices to decrease, except in cases where people who need money reduce the price to sell quickly.

Nguyen Van Dinh stated that to reduce apartment prices in Hanoi, efforts should be made to speed up the progress of social housing projects. Proactively regulate supply by effectively using planning tools, adjusting planning, and allocating additional clean land funds to help investors implement social housing projects as soon as planning is established.

In the long term, to stabilize the price of apartments in particular and housing products in general, there needs to be strong participation from the State. In particular, it is necessary to continue promoting the development of transport infrastructure, shortening the travel time from satellite areas to the city center, and the supply from the suburbs will reduce housing prices.

Source: https://dantri.com.vn/bat-dong-san/giao-dich-chung-nhung-gia-rao-ban-chung-cu-ha-noi-van-tang-nhu-len-dong-20241118023451755.htm