Apartment prices are skyrocketing, far exceeding their real value. This segment is expected to bring the best profits in 2025.

Apartment prices far exceed real value, transactions exceed residential townhouses, apartments in the center of Hanoi promise to bring the best profits in 2025... are the latest real estate news.

The selling price of primary apartments has been continuously increasing and shows no signs of stopping, creating a driving force to maintain the price level of secondary apartments at a high level, far exceeding the real value. (Photo: Linh An)

Top 3 cities with the highest growth in 2024

According to a report by the Vietnam Association of Realtors (VARS), the real estate market in 2024 has passed its most difficult period.

In 2024, the entire market recorded nearly 81,000 products offered for sale, an increase of more than 40% compared to 2023. Of which, there were 65,376 new products offered for sale, about 3 times higher than in 2023 but only about 7% compared to 2018. In the fourth quarter of 2024 alone, the market recorded 28,000 new products offered for sale, 2 times higher than the previous quarter and 4 times higher than the same period in 2023.

Transaction volume in 2024 continues to grow steadily as supply improves. In 2024, the entire market recorded more than 47,000 successful transactions, equivalent to an absorption rate of 72%.

Notably, the price increase rate of the apartment segment in many markets is strong. According to a study by VARS in a set of 150 selected projects, by the end of 2024, the average selling price in Hanoi increased by 72.4% compared to the second quarter of 2019. Da Nang followed with an increase of 49.9% while Ho Chi Minh City witnessed a slower increase, about 34.3%.

Primary prices have been continuously increasing and show no signs of stopping, creating a driving force and maintaining the secondary apartment price level at a high level, far exceeding the real value.

Along with that, the price of land plots, divided plots, with full legal documents also recovered and grew strongly in the context of a decrease in land supply due to the tightening of regulations on land subdivision and sale. In particular, low-value land plots, about under 30 million VND/m2 in cities with developed infrastructure or development plans, are sought after with prices increasing by 15% compared to the end of last year.

VARS's report also pointed out that investors tend to look for residential land in the provinces and cities in the suburbs with reasonable prices and much room for growth thanks to the benefits of infrastructure systems, urban planning... while residential land prices in two special cities, Hanoi and Ho Chi Minh City, have continuously increased and established a new high level, beyond the accessibility of most customers.

Mr. Nguyen Van Dinh, Chairman of the Vietnam Real Estate Brokers Association, commented that the real estate market is still moving positively. Market liquidity tends to decrease slightly in the high-end segment but remains stable with housing products that meet real housing needs and have reasonable values.

VARS believes that in order for the market to recover and develop in a safe, healthy and sustainable direction, investors need to ensure prices are suitable for the market's purchasing power, instead of focusing on short-term profits.

2 segments will be of interest to investors

According to Mr. Tran Quang Trung, Business Development Director of OneHousing, from changes in macro policies, project development plans and product launches of investors, the real estate market in 2025 will have 2 segments that will be of interest to investors.

The first is the apartment product, this will be the product that meets the needs of cash flow investment or investment waiting for price increase. Apartments are a segment with a moderate total price, many people can participate in investment, besides, the demand for apartment products in the future is still very high. If considering the same investment level, apartment products are showing superior values ​​compared to townhouses and residential land products in terms of rental yield and price increase rate.

According to OneHousing Center for Market Research and Customer Insights, from the first quarter of 2024 onwards, the transaction ratio between apartments and residential land in Hanoi was about 40 - 60. However, from the second quarter of 2024, with the rapid increase in demand for apartment products, this balance has changed direction - when apartment transactions have exceeded those of residential townhouses.

The second segment that many investors are targeting is low-rise products in projects, large projects, or land products with good infrastructure investment, which can form residential units. The market in 2025 will also "divide the cake" larger for this segment.

The expert recommends that investors at the present time, when participating in the market, need to carefully calculate the capital source, determine long-term investment from 2 to 3 years from the time of purchase until receiving the house. Or should buy with the purpose of preserving assets or exploiting rental cash flow, instead of participating in "surfing" investment, short-term, because this is an extremely risky and unsustainable form of investment for the market.

Which segment will give the best profit in 2025?

Mr. Nguyen Van Dinh, Chairman of the Vietnam Real Estate Brokers Association, said that apartments in the center of Hanoi are an option that investors can consider. This product line has many characteristics that greatly determine the profitability of investment.

The Chairman of the Vietnam Real Estate Brokers Association said that in the period of 2018-2023, the supply of apartments in the central area of ​​Hanoi continued to remain low along with the general decline in supply in Hanoi. By 2024, the supply of apartments in Hanoi began to grow again but was mainly concentrated in the suburban areas, far from the center, accounting for more than 90%.

The supply of apartments in the central area including Hoan Kiem, Ba Dinh, Dong Da and Hai Ba Trung districts is still very scarce. Preliminary data for 2024 shows that the central area will only record about 400 products for sale, with 3 new projects for sale, only about 30% of 2023.

The supply of apartments in the core districts of Hanoi has always remained low and is increasingly scarce, due to the increasingly depleted land fund for project development and strict regulations on height and construction density, making the supply on the market increasingly scarce. In particular, real estate prices in the central area are on an upward trend with great demand from economic and urban development. The average apartment price in the 4 central districts of Hanoi has doubled compared to the beginning of 2019, 30% higher than the average increase of the whole Hanoi. In particular, Hai Ba Trung and Dong Da are the 2 districts with the best price increase rate in the past 5 years.

Newly opened projects in the past 3 years have also continuously increased in price, about 10% after each opening phase. In 2024 alone, newly opened luxury apartment projects in the central area have common prices from 125 million VND/m2.

Serviced apartments cost around VND88 million/m2 (excluding VAT and maintenance fees). Apartment rental prices have increased rapidly, higher than the general increase of the whole market due to both the general trend and scarcity, estimated to increase by around 15% over the same period.

According to Mr. Dinh, the demand for apartments, including investment and real estate in the central area, is always maintained at a high level, especially for luxury products. The primary supply is not much, and is absorbed quite well with "drop by drop" launches.

The preliminary absorption rate of new supply in 2024 is estimated at 50%. The occupancy rate of rental apartments is always above 80% and is gradually increasing. Transactions in the area mainly arise in the secondary market due to the limited primary supply.

Mr. Dinh emphasized that the four central core districts of Hoan Kiem, Ba Dinh, Dong Da and Hai Ba Trung are always sought after by investors thanks to their prime locations and the most modern and high-quality social infrastructure in the capital. This is also where the headquarters of large enterprises, corporations and embassies are located.

As a result, real estate located in these areas has easy access to restaurants, cafes, shopping malls, international hospitals, and entertainment areas, suitable for the needs of high-end tenants. In particular, the planning of 4 central districts until 2030, with a vision to 2050, aims to create an area with many high-quality living spaces that will create an ideal living environment for residents.

Land auctioned in suburban district of Hanoi highest price over 76 million VND/m2

Quoc Oai District Land Fund Development Center in coordination with National Joint Stock Auction Company No. 5 has just successfully auctioned 26 land plots (LK2, LK6 Area) at the land auction area for land use rights DG31/2019 Yen Quan village, Tan Phu commune, Quoc Oai district (Hanoi).

The auctioned plots of land have areas ranging from 73.2-101.5 m2, with starting prices of VND4.7 million/m2.

After nearly 14 hours, the auction of 26 plots of land was successful. Of which, the plot with the highest winning price was 76.7 million VND/m2, about 16 times higher than the starting price, and the lowest was 40.7 million VND/m2, more than 8.6 times higher than the starting price.

The amount of money that Quoc Oai district collected from this auction was nearly 133 billion VND, a difference of more than 121 billion VND from the starting price.

Previously, in November, Quoc Oai district successfully auctioned dozens of land plots in Yen Quan village, Tan Phu commune. The plot with the highest winning price was 94.7 million VND/m2 and the lowest was 70.7 million VND/m2.

According to the People's Committee of Quoc Oai district, in 2024, the district successfully organized 7 auctions at 6 projects with 161 land plots, an area of ​​over 14,920 m2. The winning auction amount was over 825.3 billion VND.

This January, Joint Stock Auction Company No. 5 - National in coordination with the Land Fund Development Center of Quoc Oai district will continue to organize auctions of the right to use 26 land plots (LK1, LK2 areas) which are assets of the People's Committee of Quoc Oai district.

26 auctioned land plots belong to the project of constructing technical infrastructure for the land auction area of ​​land use rights in DG 31, Yen Quan village, Tan Phu commune, Quoc Oai district.

The land plots range in size from 85-122m2. The starting price is 4.7 million VND/m2; equivalent to 399.5 million to over 573 million VND/plot.

Time for selling and receiving auction documents until 5:00 p.m. on January 15.

Auction method: Direct voting in multiple rounds at the auction and at least 6 mandatory rounds. Direct voting in multiple rounds at the auction ends when no one participates in bidding. Bidding method: Ascending. The auction will take place on the morning of January 18.

Source: https://baoquocte.vn/bat-dong-san-gia-chung-cu-tang-chong-mat-vuot-xa-gia-tri-thuc-nhan-dinh-phan-khuc-se-mang-lai-loi-nhuan-tot-nhat-nam-2025-299638.html