Million dollar villa for rent for several tens of millions of dong a month

Villa owner "cries" because of low rental price

Although the rental real estate market is developing positively, rental prices compared to real estate values are not commensurate.

Owning a villa in a closed urban area in Hoang Mai district, Hanoi with full amenities, but due to no need to live there, Mr. Pham The Hai considered renting it out. However, renting this villa is not easy.

Mr. Hai shared that the villa has an area of 240m2, has been built on 3 floors and is fully furnished. Currently, similar villas in this urban area on the market are priced at more than 30 billion VND.

"If I leave this villa empty, it would be a waste because I have completed and installed the interior. My initial expectation was to rent it out for 50 million VND/month, but despite being very patient in finding customers, I still have to accept the rental price of 43 million VND/month," said Mr. Hai.

A villa in Tasco Xuan Phuong urban area (Nam Tu Liem, Hanoi) has a sign for rent (Photo: Ha Phong).

Not unlike Mr. Hai, Mr. Nguyen Duc Hung - a villa owner in an urban area in Nam Tu Liem District, Hanoi - is also renting out a completed villa with an area of 250m2 for 27 million VND/month. Meanwhile, the selling price of this villa on the market is fluctuating around 24-27 billion VND.

"Renting out the villa at the above price is just my short-term solution. At the moment, it helps me have monthly cash flow," said Mr. Hung.

According to a survey by Dan Tri reporters in Hanoi, the rental price of apartments is increasing. On the contrary, the rental price of commercial townhouses or villas and townhouses in urban areas is still unsold, especially the rental price is not high.

For example, many villas and townhouses in Gamuda Gardens urban area (Hoang Mai, Hanoi) with an area of 110-280m2 have rental prices ranging from 30-50 million VND/month for completed units and from 8-15 million VND/month for unfinished units. Meanwhile, the selling price of similar villas and townhouses in this urban area ranges from 17-33 billion VND/unit.

Similarly, the rental price of villas and townhouses in Nam An Khanh urban area (Hoai Duc) ranges from 13-18 million VND/month. Notably, a semi-detached villa, 39m wide double-sided road, with an area of 300m2, but the rental price is only 18 million VND/month.

In some other urban areas, the rental price of villas and townhouses in Nam Tu Liem district also ranges from 15-30 million VND/month.

The rental property market is unstable.

According to Ms. Nguyen Thuong - a real estate broker specializing in rental properties in Hanoi - the real estate rental market is vibrant, but uneven among segments. Real estate rentals are very successful in apartment products, townhouses..., but quite gloomy for villas, townhouses and commercial street-front houses.

"Business activities are still facing difficulties, so business fronts or even townhouses and villas with high rental prices are also finding it difficult to find customers. Meanwhile, real estate serving the needs of the majority of people, typically apartments, have a better number of tenants," said Ms. Thuong.

Leasing valuable real estate is not easy (Illustration: Ha Phong).

According to this broker, renting out large villas will not be easy. Because the owner expects to rent for a high price, while the tenant wants to negotiate a low price.

"There are not many people who rent villas to live in because the rental price is high. Especially for unfinished villas, renting is even more difficult even though the rental price is half cheaper than a finished villa, because the finishing cost is very high," Ms. Thuong shared.

According to some experts and professional investors, customers' investment needs are diverse. Some people invest in land, instead of depositing money in the bank, they buy land, buy it and leave it there. Some people just "surf" land to make a profit.

In addition to investors who are forced to switch to leasing due to market difficulties, there is also a group of investors who own many assets. This group of investors has a need to buy real estate as a piece of jewelry, in addition to being a place to store assets.

Therefore, for the above investors, the criteria of "frequency of use" or "rental income on asset value" are not very important to them. That is the reason why a million-dollar resort villa only brings in 2-3% of annual operating cash flow or a 40-50 billion VND townhouse is rented for 70-100 million VND.

Source: https://dantri.com.vn/bat-dong-san/biet-thu-trieu-do-cho-thue-vai-chuc-trieu-dong-mot-thang-20231122115637883.htm