Specifically, according to the ULI Asia Pacific Housing Affordability Index 2023 report, Ho Chi Minh City and Hanoi are two cities with average housing prices in the region but with a large gap compared to people's income.
In Ho Chi Minh City, the average housing price is recorded at 296,000 USD, about 7 billion VND. Meanwhile, the average income of a household is 9,120 USD/year, about 220 million VND. According to ULI's calculation, the gap between housing price and income in Ho Chi Minh City is at 32.5, the second highest in the region after Shenzhen (China) at 35.
It is worth mentioning that this difference index in Ho Chi Minh City is even higher than some major cities in China such as Beijing (29.3), Shanghai (24.1) and Hong Kong (26.5) or in some other places such as Seoul (17.3), Tokyo (16.1)...
With the above figures, it would take an average income earner about 32 years to buy a house at an average price if they spent 100% of their income on buying a house.
Lack of affordable housing has caused the housing-income gap in Ho Chi Minh City to be high.
As for the rental housing market, the average rental price per apartment in Ho Chi Minh City is recorded in the report as 592 USD, about more than 14 million VND/month. This is a rental price only suitable for young workers with high income or foreigners working in Vietnam.
Meanwhile, the rental price is considered affordable when the rental cost accounts for about 30% of the total monthly income. Thus, compared to the average income mentioned above, the rental price must be around 220 USD, about 5.2 million VND/month to be suitable for the income.
Not to mention the increasingly strong urbanization rate, promoting the shift to big cities, increasing the demand for housing. This will lead to the possibility of pushing up housing prices and rental prices in big cities like Ho Chi Minh City. Leading to the increasing gap between housing prices and income.
The above figures show that the development of social housing and affordable housing is extremely important. According to a report by Savills Vietnam, in the first 6 months of 2023, Class C apartments accounted for 62% of the market share in Ho Chi Minh City with 42% of the supply. It is expected that in the second half of the year, the number of new Class C apartments supplied to the Ho Chi Minh City market will be about 3,295 units, equivalent to 39% of the total supply.
Promoting the development of social housing in the coming time is expected to meet the housing needs of many people.
This is also the segment that many people desire and are suitable for their financial capacity. However, in recent years, the supply of class C in Ho Chi Minh City has been decreasing. By 2023, it will only account for about 25%, making home ownership difficult for many people.
However, the "frozen" period of the real estate market in early 2023 shows that only the affordable price segment can record liquidity because the demand for real housing is still very high.
Up to now, many investors have focused on exploiting this segment to meet the actual demand. Along with the support of the State's policies to increase access to capital, easy repayment of home loans with low income, thereby expecting to soon improve the problem of home ownership of the people.
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