The average price falls into the... high-end segment.
According to data just released by Batdongsan.com.vn, in August 2023, the selling price of the apartment market in Ho Chi Minh City continued to move sideways in all segments, although the level of interest continued to increase.
However, the current price of this type in the Southern market in general and Ho Chi Minh City in particular is anchored at a high price. Specifically, most of the news about selling apartment projects in Ho Chi Minh City recently are in the mid-high-end segment, with prices above 55 - 70 million VND/m2. Products with lower prices come from secondary sources, belonging to old projects.
Selling prices remained flat in August 2023 but remained high.
In addition, market data from DKRA Group in August also clearly shows that the highest primary price of apartments in Ho Chi Minh City is 312.7 million VND/m2, the lowest is 58 million VND/m2. Even in provincial markets such as Ba Ria - Vung Tau, Binh Duong, apartment prices have reached an average of 40 - 50 million VND/m2.
According to CBRE Vietnam, the average price of apartments in Ho Chi Minh City in the first 3 quarters of 2023 is 63 million VND/m2. Many mid-range projects have approached the price of 70 - 80 million VND/m2.
Commenting on this issue, Mr. Vo Huynh Tuan Kiet, Director of CBRE Vietnam's housing market, said that this is a difficult problem for a family that wants to buy a house in Ho Chi Minh City if it is based solely on income. With an average price of 4 - 5 billion VND/apartment with 2 bedrooms, an area of about 60m2, normal households with an income of about 20 million/month will take decades to buy a house without support from relatives.
The current average price is anchored in the high-end segment, causing difficulties for market liquidity.
Without support, in addition to the need for high income, one still has to use financial leverage to own an apartment at the present time. Meanwhile, the demand for buying a house in the next year is still very high.
Specifically, in the Vietnam Real Estate Consumer Psychology Report for the second half of 2023 by Batdongsan.com.vn, the demand for buying apartments priced under VND 50 million/m2 in Ho Chi Minh City increased by more than 29% over the same period last year.
Hard to find apartments under 40 million VND/m2
According to many experts, it is currently very difficult to find an apartment priced at around 40 million VND/m2 in Ho Chi Minh City. For example, the price of an apartment in a project in District 9 (Thu Duc City) with the most abundant supply in the Ho Chi Minh City market is currently around 60 - 80 million VND/m2.
Or in some projects far from the center such as Binh Tan, Nha Be, Binh Chanh, the price is also quite high compared to the actual demand. A few projects with prices below 50 million/m2 mostly come from projects that have been implemented for a long time, and have just been restarted due to resolving legal problems.
Thus, those who are in need of buying real housing can currently only look for apartments priced around 40 million VND/m2 in projects located in provinces neighboring Ho Chi Minh City, although there is also quite a small supply.
The gap between supply and demand in product prices is a difficult problem.
The difference between supply and demand and the problem of high prices are explained by the high cost of project development. Many products are still stalled and stuck due to objective factors, causing costs to increase quite high. Therefore, when the product is brought to the market, the price is no longer suitable for most of the actual needs.
Meanwhile, the demand from the real homebuying group is the biggest driving force supporting the recovery of market liquidity. This customer group has the highest demand for housing but does not have suitable products to buy.
Therefore, in the coming time, the most important issue to "rescue" the market is to improve the supply structure, focusing on developing products suitable for the majority of home buyers' budgets, which is partly helping the liquidity that has declined sharply in recent times to gradually recover.
Sharing at a recent real estate seminar, Mr. Vo Huynh Tuan Kiet, Director of Housing CBRE Vietnam, emphasized this gap between supply and demand. This expert said that the actual demand for housing is currently very large but the products that meet the demand are very limited. In particular, the segment of 2-3 billion VND/unit is seriously lacking in supply and is alarming.
Sharing about the prospects of the real estate market in the coming time, the Director of CBRE said that currently, the real estate supply has somewhat returned to the market. Recently, many projects have announced that they have construction permits, some projects have relieved financial pressure, difficulties and legal problems...
“Although the real estate market is still volatile, its long-term potential is highly appreciated. Real estate is still one of the important sectors of the economy, so the Government prioritizes solving difficulties. In the coming time, the market will develop in a more sustainable direction,” CBRE experts emphasized.
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