According to market research reports from real estate companies, housing prices continue their upward trend. Compared to five years ago, apartment prices in Ho Chi Minh City have doubled, especially in the high-end segment. The dominance of this segment has driven up housing prices, making it increasingly difficult for middle-income earners to access housing.
House prices are rising steadily.
Mr. Phong, a resident of An Lac ward (Ho Chi Minh City), said that a few years ago he bought a luxury apartment in the former Binh Thanh district for 4 billion VND, which has now increased to 9 billion VND. What's remarkable is that even though the price has almost doubled, it shows no sign of stopping.
Meanwhile, a new project in Binh Trung ward (Ho Chi Minh City) has just offered apartments for sale at prices exceeding 90 million VND/m², double the estimated price from 5-6 years ago. In Phu My Hung urban area, considered the most upscale in Ho Chi Minh City, apartment prices currently range from 80-95 million VND/m², compared to only about 37-38 million VND/m² 7-8 years ago.
According to the latest report from the Ho Chi Minh City Real Estate Association (HoREA), from 2020 to 2023, the high-end housing segment accounted for approximately 70% of the total market supply. This has led to an unbalanced market development, reversing the "pyramid" model of housing.
In the first six months of 2025 alone, Ho Chi Minh City only had 4 commercial housing projects launched, totaling 3,353 high-end apartments worth over 10,239 billion VND. There were no projects in the mid-range or affordable housing segments. Meanwhile, social housing was also very modest, with only 205,000 m² of construction area, equivalent to 4,100 apartments, reaching only about 11.7% of the plan for 2025. According to Mr. Le Hoang Chau, Chairman of HoREA, house prices have increased continuously over the past many years and are currently pegged at high levels. A high-end apartment can cost up to 90 million VND/m², equivalent to about 9.7 billion VND/apartment, far exceeding the affordability of the average income earner.
Apartment prices in Ho Chi Minh City have more than doubled in the past 5 years.
Savills Vietnam assesses that the housing market in Ho Chi Minh City has been facing a serious supply shortage for the past five years. Despite a target of developing 235,000 new homes between 2021 and 2025, the city has only completed 24% of the plan so far, leaving a shortfall of nearly 179,000 units. In the second quarter of 2025, Ho Chi Minh City only added 1,600 new apartments to the market, bringing the total primary supply in the first six months to 6,800 units. However, the absorption rate only reached 45%, meaning only 3,800 units were transacted. The main reasons are believed to be slow approval processes and legal barriers.
Land use fees are too high.
Mr. Vo Hong Thang, Deputy General Director in charge of DKRA Consulting and Investment Director of DKRA Group, said that land costs, including purchase costs, taxes, legal fees, loan interest, etc., currently account for a large portion of the total investment cost of a project, while construction costs or apartment quality are easier to control. Therefore, he expects that when legal obstacles are removed from projects, coupled with a reduction in land use fees, real estate prices in Ho Chi Minh City will "cool down".
Dr. Pham Viet Thuan, Director of the Institute of Economics and Environmental Resources in Ho Chi Minh City, believes that the increase in land prices and the surplus method in determining land use fees are the core reasons for the high increase in apartment prices. According to him, applying land prices close to market value, as stipulated in the Land Law and Decree 71/2024, has created an artificial price inflation in the market, especially after the removal of the land price framework. Therefore, he argues that adjustments are needed in the 2024 Land Law to reduce the percentage of land price used when changing land use purposes, in order to control input costs and stabilize real estate prices. Determining land prices in a controlled manner will contribute to reducing housing prices and promoting social welfare.
At the seminar "Land Prices, Land Taxes… How to Make Them Reasonable" organized by Thanh Nien Newspaper on July 22nd, lawyer Truong Anh Tu, Chairman of TAT Law Firm, suggested that the state needs more reasonable solutions in collecting taxes related to land, especially in the construction of land price tables and tax policies.
According to him, land prices need to be determined in a way that harmonizes the interests of all parties, meaning the state does not lose tax revenue, businesses still ensure business efficiency and profit margins, market supply and demand are not disrupted, and people still have access to land. This is the overarching goal that needs to be ensured. This means that land prices do not necessarily have to be entirely based on market prices.
Ms. Vo Nhat Lieu, Director of the PROPIIN Institute for Real Estate Project Development Training, pointed out a crucial variable: land use fees often account for up to 50% of the total project cost, with land plots accounting for around 20%. Many international investors have hesitated due to the lack of standardized valuation formulas and unpredictable cost fluctuations.
Therefore, she proposed waiving or significantly reducing land use conversion fees for households with less than 300 m², and imposing higher taxes on individuals owning multiple plots of land. Land prices also need to be kept stable for a sufficient period, avoiding situations where localities raise prices too quickly, creating disparities between regions and triggering speculative waves.
Deputy Minister of Finance Le Tan Can also acknowledged that the two biggest bottlenecks at present are the method of calculating "additional payments" and land use fees when converting agricultural land to residential land. He said that the Ministry of Finance has completed the draft Decree amending Decree 103/2024 and sent it to the Ministry of Justice for appraisal before submitting it to the Government for promulgation. The goal is to resolve these issues as soon as possible, because localities have continuously reported cases of "financial impossibility" due to excessively high fees and taxes.
Increase land use efficiency
The Chairman of HoREA believes that to reduce housing prices, Ho Chi Minh City needs to prioritize increasing the supply of social housing while also strongly reforming administrative procedures. Specifically, a pilot resolution should be issued and the 2023 Housing Law amended to grant the authority to approve social housing projects to the Departments of Construction, instead of requiring approval through the Investment Law as is currently the case.
In addition, he proposed amending Decree 100/2024/ND-CP to increase the land use coefficient for social housing projects to a maximum of 1.5 times. This would help increase the number of apartments by 50% on the same land area, thereby reducing the cost of apartments.
Furthermore, localities need to coordinate effectively to shorten the time for planning approval and licensing. The development of affordable commercial housing should also be encouraged through preferential credit policies, especially for young people. The government also needs to restructure the market by encouraging businesses to shift towards the affordable housing segment, combined with a program to build 1 million social housing units by 2030.
Another crucial solution is to amend the Real Estate Business Law to allow the transfer of projects that have not yet fulfilled their financial obligations regarding land, provided that the new investor fulfills these obligations. This would help revive stalled projects and increase supply.
Source: https://nld.com.vn/giam-gia-dat-de-ha-nhiet-gia-nha-196250722220941319.htm
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