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In 2024, apartment prices will definitely increase

VTC NewsVTC News31/12/2023


According to a report by Batdongsan.com.vn, in the long period from 2015 to 2023, the apartment price increase index in Hanoi and Ho Chi Minh City was 82% and 56% respectively. According to calculations by Savills Vietnam, the apartment price growth rate from 2019 to the first half of 2023 was 13%/year.

It is worth mentioning that although apartment prices have increased quite high over the past many years, according to many experts, in 2024, this segment will continue to "heat up".

Mr. Nguyen Van Dinh, Chairman of the Vietnam Association of Realtors (VARS), said that although the price of inner-city apartments is already high, the increase will continue due to high demand while supply is limited. In particular, the selling price of primary apartments in Hanoi will continue to increase by an average of 3-8%, with luxury apartments increasing the most. Limited supply will also cause the rental price of apartments in Hanoi in 2024 to increase by about 5%.

Apartment prices are expected to continue to increase in 2024. (Illustration photo)

Apartment prices are expected to continue to increase in 2024. (Illustration photo)

Explaining this statement, Mr. Dinh said that the scarce supply, especially the severe shortage of low-cost and affordable apartments, combined with the increase in input costs from materials, labor, land prices, etc., has had a cumulative impact on apartment prices.

" The housing demand of people in big cities is still very high, while the preparation work for investment in real estate projects is prolonged, making it impossible to meet the supply immediately. Many projects are also stalled due to legal problems, so apartment prices can only remain high or continue to increase, " said Mr. Dinh.

Sharing the same view, Professor Dang Hung Vo also commented that apartment prices in 2024 will continue to increase. Explaining this, Mr. Vo said that the story of increasing house prices despite the sluggish real estate market is not surprising when the prices of raw materials and labor are increasing steadily every year, so the cost of building a house will certainly increase accordingly.

Not to mention, a group of speculators, buying and reselling in the secondary market, has caused the price of houses to reach end users to be inflated many times.

Sharing the same view, Ms. Do Thu Hang, Senior Director, Consulting and Research Department, Savills Hanoi also commented that apartment prices will continue to increase in the coming time due to rising land prices and construction costs.

In addition, the need to invest in improving the quality of products and surrounding infrastructure and utilities, and internal projects also lead to primary market prices, or prices of newly launched projects, always being higher than the general market level of apartments for sale.

On the other hand, Mr. Nguyen The Diep, Vice President of Hanoi Real Estate Club, assessed that the current shift in buyer demand is focusing on the apartment segment because this is one of the products with a suitable price for people to pay, although it has increased significantly.

This change in psychology has led to increasing demand while supply is low, so apartment prices continue to be very high. For projects under construction and newly opened for sale, the price increase margin will be higher, because investors are under great pressure on input costs. It is forecasted that apartment prices will continue to increase in the coming years, in the context of great demand created by the urbanization process ,” Mr. Diep analyzed.

Experts from Batdongsan.com.vn also believe that apartment prices cannot be lower or reduced for three reasons.

Firstly, there is a supply-demand imbalance in the market when people's real housing needs are still high but the supply of apartments is limited, especially apartments within the price range and in the inner city.

Second, the world economy is fluctuating, leading to high prices of construction materials, forcing investors to increase product prices to make a profit.

Third, land funds are limited while land prices are increasing, so implementing a project takes a lot of time and money.

Chau Anh



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