A survey of new apartment prices in Dong Da district shows the lowest price starting from 75 million VND/m2; Hanoi announces 5 projects permitted to sell to foreigners, mostly high-end apartments… These are some of the notable real estate news items from the past week.
Deputy Minister of Construction : House prices have surged despite the market not being particularly active.
At the regular government press conference on the afternoon of October 7th, Deputy Minister of Construction Nguyen Viet Hung answered questions from the press regarding the sudden and artificial increase in housing prices in some major cities, despite the fact that the market has not yet become truly vibrant.
Accordingly, Mr. Hung pointed out the causes of this situation. First, it is a consequence of the supply-demand imbalance, where demand far exceeds supply. The second reason stems from price manipulation, inflated prices, and land auctions in some localities. Finally, the factor causing the increase in house prices is the continuously rising input costs for project development.
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| Mr. Vu Hong Thanh, Chairman of the Economic Committee, spoke at the meeting on the morning of October 9th. |
The Deputy Minister of Construction stated that there are many legal regulations prohibiting market manipulation and price inflation. Specifically, the Penal Code, the Land Law, and especially the 2023 Real Estate Business Law, have very clear provisions regarding prohibited acts in real estate business.
Mr. Hung said that the Ministry of Construction has issued a document analyzing the cost structure, selling prices, causes of real estate price increases, and proposing several solutions to reduce housing and land prices and stabilize the real estate market.
The Ministry has also issued a document to strengthen the management and control of real estate price fluctuations, addressed to the People's Committees of provinces and cities; in which it proposes solutions and recommends that ministries, sectors, and provinces implement specific tasks.
High demand in the real estate market.
This was the assessment of Professor Hoang Van Cuong, a member of the Finance and Budget Committee of the National Assembly, at the seminar "Vietnam's Real Estate Market in the Context of Amendments to the Law on Land, Housing and Real Estate Business".
According to Mr. Cuong, market demand is currently very high, especially in Hanoi, with many projects selling out as soon as they launch. However, this is not necessarily a good sign.
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| Professor Hoang Van Cuong shared his views on the real estate market situation. |
“In recent times, legal obstacles have led to a decrease in supply. In addition, project implementation costs are increasing, and access to clean land is becoming more difficult. Currently, the supply largely consists of projects that have already commenced,” Mr. Cuong said.
According to a member of the National Assembly's Finance and Budget Committee, the situation of skyrocketing real estate prices amidst decreasing inventory but no increase in supply will create an imbalance in the market. This will be a time when speculators benefit the most, rather than genuine homebuyers.
Speaking at the seminar, Mr. Nguyen Van Dinh, Chairman of the Vietnam Association of Real Estate Brokers (VARS), said that the escalating real estate prices stem purely from the law of supply and demand. If the goal is to "cool down" prices, the main factor that needs to be addressed is the supply, rather than administrative interventions.
“The market is currently divided into two segments. One is the high-end segment serving those with good financial means and investors. The other is the social housing segment. It’s noteworthy that affordable housing products, the segment between these two, are almost non-existent,” Mr. Dinh emphasized.
The head of VARS believes that affordable housing projects are what the majority of people aspire to, and this is the crucial missing piece in the overall market picture. Policymakers need specific regulations to promote this segment, only then will the market truly stabilize.
Despite an increase in the number of new apartments in Hanoi, housing prices remain unchanged.
According to CBRE, the supply of new apartments in Hanoi is increasing. In the third quarter of 2024 alone, the market recorded over 8,200 apartments offered for sale. Over the past nine months, the total new supply could reach 19,000 units, exceeding the total supply for the entire year of 2023. This is also the highest number recorded in Hanoi in the last five years.
Similarly, the supply of landed houses also increased significantly. In the third quarter of 2024, the market saw over 3,200 new units launched, with 80% coming from urban areas in Dong Anh district. This number exceeded the total new supply for the entire previous year. In total, 3,500 new units were launched in the past nine months, the highest level in the last five years.
According to Ms. Nguyen Hoai An, Senior Director of CBRE Hanoi branch, it is predicted that from now until the end of the year, the supply of apartments and townhouses will see nearly 5,000 new units launched, mainly from projects by Vinhomes, Sunshine Group and Nam Cuong Group in the west and east of the city.
Including this year, the number of new apartments and townhouses expected to be launched is projected to be the highest in many years, at nearly 30,000 and 5,000 units respectively. With these figures, Ms. An affirmed that the cycle of housing supply shortage in Hanoi over the past four years has come to an end.
However, despite the increased supply, selling prices show no signs of cooling down. The average primary price for apartments is 69 million VND/m2, up 6% quarter-on-quarter and 28% year-on-year. Similarly, the price of new landed houses has reached 235 million VND/m2, up 16% quarter-on-quarter and nearly 27% year-on-year.
Price survey of new apartments in Dong Da district: lowest price starts from 75 million VND/m2.
According to an investigation by a reporter from the online newspaper Dau Tu, there are currently three new apartment projects being launched for sale in Dong Da district – one of the busiest and most crowded districts in Hanoi.
First is The Ninety Complex (Lang Street, Nga Tu So Ward), which is a condotel type apartment where customers sign a 50-year lease contract with the developer.
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| The Ninety Complex project is located right on Lang Street, Nga Tu So Ward. Photo: Thanh Vu |
Apartment prices here will range from approximately 75 to 80 million VND/m2. For apartments with prime locations, the selling price will climb to 90 million VND/m2. Service fees at the project are 20,000 - 25,000 VND/m2/month. Apartments are expected to be handed over in the first quarter of 2025.
Buyers should pay particular attention to the legal aspects of condotel projects. Currently, projects in this segment are still stalled in the process of obtaining land ownership certificates, despite the government's issuance of Decree No. 10/2023/ND-CP to address this issue. According to discussions with real estate agents, the Ninety Complex project is still uncertain about the possibility of issuing land ownership certificates to customers.
"After the contract expires, the renewal fee will be calculated based on the land tax at that time. Additionally, if the apartment is eligible for a land ownership certificate in the future, the developer will assist residents in obtaining it. The registration fee will be paid by the residents," the real estate agent stated.
Next is The Gloria apartment project (Nguyen Hong Street, Lang Ha Ward). Units from the 3rd to the 8th floor are being offered for sale by the developer as long-term ownership apartments. The units above will be operated as hotel apartments for rent and are not for sale.
The project was handed over in Q3/2024. Currently, all units offered for direct sale by the developer have been sold; customers can only purchase units resold from residents. The average price of apartments here is around 115-120 million VND/m2.
According to real estate agents, if clients entrust the rental management to a company, a two-bedroom apartment can generate an average monthly income of approximately 18 million VND (after deducting operating costs). However, if clients manage the rental themselves, the income could reach up to 25 million VND per month.
Next is the HD Mon Central apartment complex (Lang Ha Ward, Dong Da District). This project will be launched for sale in November 2024. All apartments offered for sale have long-term ownership rights. For apartments on lower floors, the price will be around 135 million VND/m2. For apartments on higher floors, the price will be around 150 million VND/m2.
Hanoi announces 5 projects permitted to sell to foreigners, mostly high-end apartments.
Recently, the Hanoi Department of Construction announced the list of projects allowing foreign organizations and individuals to own property in the city, as of October 2024.
The first project is building HH2 – 1A, part of the Golden Palace A residential, commercial, and service complex, commercially known as The Matrix One (Me Tri and Phu Do wards, Nam Tu Liem district). The investor of the project is Mai Linh Investment Joint Stock Company. Currently, apartment prices here range from approximately 90 to 100 million VND/m2.
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| Four out of five announced projects are located in Nam Tu Liem district. Photo: Thanh Vu |
Next is the Viha Complex project (Nguyen Tuan Street, Thanh Xuan District) by a joint venture between Xuan Loc Tho Co., Ltd. and Thong Nhat Printing and Trading JSC. The apartments here all have at least two bedrooms, with the smallest unit measuring up to 72 m2. Currently, the price is around 90 million VND/m2.
Next are the apartment buildings of the investor HBI JSC. Specifically, these include buildings Z38M.1, Z38.1, and U39.1 located on land plots F2 – F4 – CH04. In addition, there are also buildings Z38M.1 and Z38.1 located on land plots F2 – F4 – CH05.
According to the Department of Construction, this project is located in Tay Mo ward, Nam Tu Liem district. Therefore, it is highly likely that these are buildings within the Imperia Smart City project. Currently, new apartments here are being offered for sale at approximately 70 million VND/m2.
Finally, there are the U35.1, U35.2, and U35.3 apartment buildings located on plot F2 – CH01 of the Tay Mo – Dai Mo – Vinhomes Park new urban area, commercially known as Vinhomes Smart City (Tay Mo ward, Nam Tu Liem district). The investor of the project is SV Tay Ha Noi Real Estate Business Development Joint Stock Company.
In a recent report, Cushman & Wakefield noted that Vietnam is an attractive emerging market for investment with appealing returns. Currently, the return on investment for residential real estate segments is around 8-10% per year, higher than the 2-3% per year in other countries in the region.
Aeon Mall loses over $7 million due to project cancellation in Hoang Mai district.
Aeon Mall's financial report for the first half of the 2024-2025 fiscal year revealed that the cancellation of the project in Hoang Mai district (Hanoi) resulted in a loss of approximately 1.1 billion yen, equivalent to 7.4 million USD.
Previously, in 2019, Aeon Mall Vietnam proposed to the leaders of Hanoi City to implement a parking lot project combined with a shopping mall. By early February 2023, the City People's Committee had approved the detailed planning task for the project. The planning area is located in Dai Kim and Thinh Liet wards, Hoang Mai district.
The total area of the planned land is approximately 8 hectares, of which 1.97 hectares are allocated for city transportation and 6.06 hectares are for project research.
The project aims to create a model for constructing a parking lot combined with a modern commercial center, office space, and warehouse, ensuring seamless, scientific integration and the application of high technology.
Aeon Mall Hoang Mai is expected to become the third shopping mall of the Japanese corporation in Hanoi, after Aeon Mall Long Bien and Aeon Mall Ha Dong, with high expectations for its contribution to the retail market in the capital city.
However, by the beginning of this year, information about the Aeon Mall Hoang Mai project was no longer included in Aeon Group's plans for developing shopping malls in Vietnam.
Nevertheless, Mr. Furusawa Yasuyuki, General Director of Aeon Vietnam, affirmed that in the long-term vision, Vietnam remains the second most important market, alongside Japan, in Aeon's strategy.
According to Aeon Mall's semi-annual report for fiscal year 2024, the Vietnamese market generated nearly 8.2 billion yen, or approximately 55 million USD, in revenue for the parent company, a 15% increase compared to the same period last year.
Da Nang welcomes 941 new luxury apartments along the Han River.
Mr. Tran Van Hoang, Deputy Director of the Da Nang City Department of Construction, has just signed a notice stating that future housing units in the Han River waterfront apartment complex project are eligible for sale.
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| The apartment complex project on the Han River bank is currently under construction, with the foundation and basement being built. |
According to the Department of Construction, the number of future housing units eligible for sale at the apartment complex project on the Han River bank, invested by Dong Do Group Joint Stock Company, is 941 apartments with areas ranging from 45.1 m2 to 264.9 m2, totaling 67,522.8 m2.
According to the initial investment registration certificate issued by the Da Nang City Department of Planning and Investment on January 13, 2022, the apartment complex project on the Han River bank has a total of 941 apartments, with a total investment of over 1,324 billion VND.
Currently, the project is commercially known as Peninsula Da Nang. Athena Luxury Investment Co., Ltd. is the project developer, and Vietnam Smart City Joint Stock Company (part of Dat Xanh Group) is the exclusive distributor. The project's products include high-end apartments (28 three-bedroom units, 164 one-bedroom units, and 749 two-bedroom units) and ground-floor shophouses.
The average selling price at the project is approximately over 53.5 million VND/m2, after deducting initial sales incentives. It is expected that the developer will make price adjustments every 15 days during October, November, and December 2024.
Dong Do Group Joint Stock Company was awarded the land use rights for Lot A2-1 in the Nai Hien Dong fishing village residential area (Le Van Duyet Street, Nai Hien Dong Ward, Son Tra District) on August 3, 2020, with a winning bid of 43.3 million VND/m2. Previously, the starting price was over 42.17 million VND/m2, for a total land area of 7,167.5 m2.
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