The apartment market in Hanoi and Ho Chi Minh City is the hot spot of the real estate market in 2024. Not only the supply but also the transactions and selling prices of this segment have grown in the past year. This is the opinion of Ms. Duong Thuy Dung, CEO of CBRE Vietnam, about the developments of the apartment market in key housing markets.
Apartment Market: Supply and Transactions Increase
At CBRE’s 2024 real estate market overview report, Ms. Duong Thuy Dung said that both supply and liquidity of the apartment segment will grow in 2024. While the housing supply in Ho Chi Minh City is limited with only about 5,300 products, including apartments and townhouses/villas, the new supply of the housing market in Hanoi has grown strongly with nearly 38,000 products. Hanoi overwhelms Ho Chi Minh City in terms of housing supply, including apartments.
Specifically, Ms. Dung emphasized that in 2024, the supply of newly launched apartments in Hanoi will triple compared to 2023, exceeding 30,900 units and being the highest annual new supply since 2020. Meanwhile, the supply of newly launched apartments in Ho Chi Minh City will be at its lowest since 2013, with just over 5,000 newly launched apartments. Most of the new supply is focused on high-end projects with full legal documents, developed in large urban areas in Nam Tu Liem and Gia Lam, which are already in operation with a certain number of residents. This has led to an increase in primary selling prices as well as sales rates exceeding 70% in projects. In particular, remote areas such as Dong Anh and Van Giang (Hung Yen province bordering Hanoi) are recording an increase in high-end supply, driven by the development of large urban projects in these areas.
In Ho Chi Minh City, more than 70% of new supply in the year comes from high-end, luxury projects and projects opening for sale in the next phase. In the Thu Thiem area, there is a project offering the final phase with apartment prices up to 490 million VND/m2 of net floor space. Despite setting high primary selling prices, investors also apply many preferential sales policies such as payment extensions of up to 5 years, discounts from 5% to 16% for standard payments… Therefore, the absorption rate of newly opened projects reaches an average of 70% of the number of units opened for sale in the fourth quarter and the whole year of 2024. In particular, some high-end to luxury projects with convenient connections to the central area recorded a sales rate of nearly 100% on the opening day alone, attracting the majority of investors with available cash flow and choosing standard payment policies with high discounts.
Selling Prices Increase In Both Primary And Secondary Markets
The CEO of CBRE Vietnam also said that apartment prices have increased sharply in both the primary and secondary markets. In the primary market, apartment prices in Hanoi continued to climb as of the fourth quarter of 2024, the selling price reached VND72 million/m2, an increase of 36% over the same period last year. This is the highest increase recorded in the past 8 years in the Hanoi market. In Ho Chi Minh City, the current primary selling price of apartments is an average of VND76 million/m2, an increase of nearly 24% year-on-year. This increase is due to the fact that more than 70% of the new supply in the city this year is high-end to luxury projects and projects opening for sale in the next phase, with price adjustments increasing from 10% to 40% compared to the previous phase.
In the secondary market, the selling price of apartments in Hanoi is gradually catching up with the price in Ho Chi Minh City, reaching an average price of VND48 million/m2 in Hanoi and VND49 million/m2 net (excluding VAT and maintenance fee). In Hanoi, the increase in secondary selling prices has maintained a stable growth compared to the beginning of the year, up 5% quarter-on-quarter. Compared to the same period last year, the secondary selling price of apartments in Hanoi has increased by more than 26% year-on-year, the highest annual increase ever recorded.
On the other hand, Ms. Dung said that the secondary selling price of apartments in Ho Chi Minh City continued to increase slightly, increasing by an average of 7% year-on-year. Notably, Metro Line 1, which began commercial operation at the end of December 2024, has led to an increase in prices of projects located along the metro line. Typically, in District 2 (old) and District 9 (old) of Thu Duc City, the average secondary selling price increased by 2%-3% quarter-on-quarter and nearly 15% year-on-year.
In addition, in 2025, the new supply of apartments in Hanoi is expected to continue to be abundant, estimated at more than 31,000 units for sale, higher than in 2024. The supply is mainly concentrated in the high-end segment, with an increase in luxury supply. In addition, the supply is also expected to expand to the southern areas (Hoang Mai district), the eastern area (Long Bien district) and the western area (Dan Phuong district). The abundance of new supply will contribute to maintaining a stable growth in primary prices, expected to increase by an average of 6-8% per year.
