Why are villa and townhouse prices in Ho Chi Minh City higher than in Hanoi?

(Dan Tri) - Prices of villas and townhouses in Ho Chi Minh City are higher than in Hanoi due to a shortage of supply and high prices of newly opened projects. Upcoming supply is expected to improve.

Prices are hundreds of millions of VND/m2 apart.

Mr. Vo Huynh Tuan Kiet - Director of Housing Project Marketing Department at CBRE Vietnam - said that the primary selling price of townhouses and villas in Ho Chi Minh City by the end of 2024 will reach VND 310 million/m2, an increase of 13% over the same period last year, with an absorption rate of nearly 80%.

The information was shared by Mr. Kiet at a recent event, emphasizing that the new high-priced supply comes from projects in Thu Thiem and Phu My Hung, ranging from 680-900 million VND/m2 of land.

The transaction price of villas and townhouses in Ho Chi Minh City is recorded to be about VND90 million/m2 higher than the same segment in Hanoi. The selling price in Hanoi is about VND220 million/m2, an increase of 20% compared to last year.

The difference in villa and townhouse prices between Ho Chi Minh City and Hanoi was also mentioned by research unit JLL in its 2024 market report. Accordingly, the new opening price of villas and townhouses in Ho Chi Minh City reached 16,936 USD/m2 (about 430 million VND/m2), an increase of 11% compared to the previous year. Meanwhile, Hanoi recorded a price of 10,451 USD/m2 (about 265 million VND/m2), an increase of 44%.

The report of Dat Xanh Services Institute of Economics - Finance - Real Estate (DXS - FERI) also noted that for townhouses and villas, transaction prices in Ho Chi Minh City and neighboring provinces are higher than in Hanoi and neighboring provinces. These markets all have an upward trend in prices over the past year, with a common increase of about 3-10%.

JLL experts said the increase in townhouse prices in Ho Chi Minh City comes from newly launched projects with high prices, while low-priced projects that have been sold out are removed from the primary market. Meanwhile, in Hanoi, the overwhelming supply comes from a number of large projects in the high-end segment.

Prices of villas and townhouses in Ho Chi Minh City are higher than in Hanoi (Photo: Quang Anh).

Although the prices of villas and townhouses in Ho Chi Minh City are higher, research units have found that the supply of this market is in short supply. CBRE Vietnam stated that in the past two years, the supply of townhouses and villas in Ho Chi Minh City has not come from large-scale urban projects.

Therefore, the new supply in 2024 will decrease by 80-90% compared to the period 2016-2022, mainly coming from projects in Binh Chanh district. Other newly launched projects are all small-scale, only about 10-50 units/launch.

JLL pointed out that the reason for the shortage is that pre-sale projects are not yet eligible to sign sales contracts. At the same time, investors are being more cautious in the context of transitioning to a new legal framework.

Supply forecast for HCMC to improve this year

This year, CBRE forecasts that new supply in Ho Chi Minh City could reach about 2,000 units, eight times higher than last year, thanks to new urban projects being implemented in the East and South. The upward price trend will continue, as newly launched projects are expected to maintain prices of VND300-400 million/m2.

JLL believes that the housing market in Ho Chi Minh City is dominated by the high-end segment, lacking commercial housing projects suitable for the financial capacity of the majority of people.

This year, the market is expected to receive more supply in the lower price segment, mostly concentrated in areas outside the 10km radius from the center. Preferential sales policies to stimulate demand are also expected to be promoted.

In Hanoi, in addition to the supply from the next phases of existing projects, CBRE believes that the market will record supply from new urban projects in Dan Phuong, Long Bien and Tay Ho in the next 2-3 years. The total supply of real estate attached to land in Hanoi is expected to exceed 7,000 units this year.

JLL believes that Hanoi's supply is still driven by large projects. Supply and prices will be more diverse, differentiated by location, expected to reach many customers, especially those with long-term housing or investment needs. Notably, buyers tend to be cautious and prioritize finding products with real residential value in the near future.

Source: https://dantri.com.vn/bat-dong-san/gia-biet-thu-lien-ke-o-tphcm-vuot-mat-ha-noi-vi-sao-20250109055700817.htm