Apartment prices continue to increase
Contrary to the general sluggishness of the real estate market in recent times, apartment prices have been continuously increasing. Currently, in big cities such as Hanoi and Ho Chi Minh City, apartments still maintain their appeal as the segment that is of top interest to real estate seekers.
A newly published report by a real estate market research unit said that in the third quarter, in both the buying and selling and rental markets, while many types of businesses slowed down, apartments were the rare type that still maintained positive growth figures.
Specifically, in the buying and selling market, in terms of interest, apartments increased by 1%, while other segments decreased by 4-11%. In the rental market, the above segments decreased by 13-28% in interest, while apartments increased by 6%.
According to the third quarter real estate market report of the above unit, from 2015 to now, the income growth rate of people has not kept up with the price increase index of apartments in Hanoi and Ho Chi Minh City. After 8 years, the income of urban people has only increased by 39% (data from the General Statistics Office), but the price of apartments in Ho Chi Minh City and Hanoi has increased by 82% and 56% respectively.
Apartment prices continue to increase, far exceeding the income of urban residents (Illustration: Ha Phong).
According to the Ministry of Construction, in the third quarter, according to the synthesis of reports and survey information from localities and market research organizations, apartments were the type of real estate least affected by the negative impacts of the market in the past year because this type serves real housing needs.
Interest in apartments has shown signs of recovery, with demand for buying apartments increasing by 1% and for renting apartments increasing by 6% compared to the previous quarter. Of which, apartments priced from 2 to 4 billion VND are the most sought after. In major cities, there have been signs of good absorption, concentrated in the apartment segment, housing priced under 10 billion VND in the central core area.
Specifically, in Hanoi, the average selling price of apartments opened for sale in the third quarter in the primary market increased by nearly 7% quarter-on-quarter, up 14% year-on-year, reaching about VND50.8 million/m2. The price adjustment followed an upward trend due to the overwhelming proportion of new supply in the high-end segment (over 90%). Along with that, some investors adjusted prices upward and opened additional inventory on higher floors.
In the secondary market, the average apartment selling price continued to increase from the previous quarter, reaching about VND32 million/m2, up 2.7% quarter-on-quarter and 0.8% year-on-year. All districts in Hanoi recorded an increase in secondary selling prices in the third quarter compared to the second quarter, of which Dong Da, Thanh Xuan, Tay Ho, Nam Tu Liem and Gia Lam districts increased by over 3%.
In Ho Chi Minh City, the number of new apartments launched for sale in the third quarter mostly came from the next phase of existing projects. About 60% of the new supply in the first 9 months of this year came from an urban area project in the East.
About 96% of the new supply in the third quarter came from the high-end segment and the remaining 4% of new supply was in the luxury segment, from the next phase of a project in the Thu Thiem New Urban Area. The primary selling price of the HCMC apartment market in the third quarter reached more than VND60 million/m2.
In the secondary market, the average apartment price reached VND45 million/m2, up 3% compared to the previous quarter. Meanwhile, secondary prices in the luxury and affordable segments remained almost the same compared to the second quarter.
Investors "surf", buyers pay high prices
Mr. Tran Duc Cuong in Hoang Mai District (Hanoi) said that last Thursday, he decided to deposit to buy a 72m2 apartment in Hoang Mai District (Hanoi) for 2.2 billion VND. Mr. Cuong bought this apartment from a "surfing" investor.
"The person who sold me the apartment is an investor. They bought this apartment for 1.9 billion VND since September this year and the current transaction status is that they have paid a notarized deposit of 300 million VND," Mr. Cuong shared.
Apartments have become a "piece of cake" for investors to "surf" recently (Illustration: Ha Phong).
According to Mr. Cuong, due to the need to live, buying a satisfactory apartment at a higher price from a "surfing" investor is also acceptable. "What I am most concerned about is not the price but how to carry out the transfer process smoothly and with the least risk," said Mr. Cuong.
Mr. Nguyen Van Nam - a professional real estate investor in Hanoi - said that apartments are a segment that investors have been particularly interested in for the past 2-3 years. The level of profit and price increase is not as fast as land or residential land, but the price of apartments has grown steadily, has low risk and is especially easy to liquidate in recent times.
"Since the end of 2021, when the land market was "hot" across the country, many investors, including me, withdrew their capital to invest in apartments in Hanoi. The use of financial leverage was also calculated more carefully," Mr. Nam shared.
According to this investor, investing in apartments will not bring quick and large profits, but at this stage, this is a segment with good liquidity. "Depending on the capital source, some investors will choose to invest long-term and rent. There are also quick investors, looking for good sources of goods to "surf", but the profit will certainly not be high," Mr. Nam added.
From an expert perspective, Mr. Nguyen Van Dinh - Chairman of the Vietnam Real Estate Brokers Association - also admitted that apartment prices will continue to increase in both the primary and secondary markets, especially in the affordable and mid-range segments and in projects that are nearing the end of the product line.
This expert also emphasized that supply is increasingly scarce while the cost of land fund creation, raw material costs, and financial access costs are increasing... Therefore, real estate projects find it difficult to reduce prices and are forced to maintain high selling prices.
"The price increase may stop when procedural, legal and capital problems are resolved, boosting market supply," Mr. Dinh emphasized.
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