Have we reached the 'peak'?

(CLO) While in the period of 2019-2021, real estate in Ho Chi Minh City, including apartments, villas, townhouses, etc., saw price increases significantly higher than in Hanoi , currently, the rate of housing price increase in this area has slowed down.

A "strange" trend in Ho Chi Minh City real estate: Prices of townhouses and villas unexpectedly drop.

Since 2018, the declining supply of housing from apartment projects and urban areas has caused housing prices in major cities like Hanoi and Ho Chi Minh City to continuously "break records," with prices higher each month than the previous month, and each quarter setting a new record compared to the previous quarter.

While real estate prices in Ho Chi Minh City, including apartments, villas, and townhouses, increased more significantly than in Hanoi during the period of 2019-2021, the rate of increase in this area has now slowed down.

According to the latest report from the Ministry of Construction , in the third quarter of 2024, housing prices in Hanoi and Ho Chi Minh City continued their upward trend. However, there were differences between the various segments.

Apartment prices in Hanoi and Ho Chi Minh City continue their upward trend. However, the Hanoi apartment segment is experiencing a more rapid increase, with prices continuing to break records in both old and new projects, rising by approximately 4% - 6% compared to the previous quarter, equivalent to a 22% - 25% increase compared to the same period last year.

During the period 2019-2021, housing prices in Ho Chi Minh City, including apartments, villas, townhouses, etc., increased significantly more than in the Hanoi real estate market. (Photo: ST)

For the villa and townhouse segment in Hanoi, the selling prices of villas and townhouses in projects tend to continue increasing compared to the previous quarter. Most of the new projects launched this quarter are located in favorable areas with significant infrastructure investment, therefore the primary selling prices are relatively high.

The average secondary market selling price of landed houses in Hanoi in Q3 2024 reached approximately VND 160 million/m2, an increase of 3% quarter-on-quarter and nearly 7% year-on-year.

Some projects in areas like Dong Anh and Long Bien experienced higher secondary market price increases (around 5%) quarter-on-quarter, thanks to infrastructure development and the gradual completion of new projects.

Meanwhile, in Ho Chi Minh City, the average primary price of villas and townhouses in projects remained almost stable, although some areas saw sharp price decreases in the high-end, large-area segments, falling by approximately 14% quarter-on-quarter and 28% year-on-year.

Similarly, secondary market prices of some projects in Ho Chi Minh City fluctuated downwards by about 3% to 4%. Specifically, An Phu An Khanh in District 2 decreased by about 4.3% to 265.6 million VND/m2, Q7 Saigon Riverside decreased by about 4.1% to 79.2 million VND/m2, Sim City decreased by about 4.4% to 62.5 million VND/m2, etc.

Market "tastes" vary.

Some argue that the housing market in Ho Chi Minh City has almost reached its peak, while speculation in Hanoi is on the rise.

Speaking with a reporter from the Newspaper of Journalists and Public Opinion, Mr. Nguyen Trung Tuan, a real estate expert, stated that the real estate market in Hanoi in particular and Northern Vietnam in general favors investment-oriented properties, while the Southern market tends to favor buying homes for personal use rather than for investment.

There were also some investors from the North who previously moved South, but because real estate prices in that area have risen to their limit, they have returned to markets with lower prices.

At the recent seminar "Capital Flows into Southern Real Estate," Associate Professor Dr. Tran Kim Chung, former Deputy Director of the Central Institute for Economic Management Research, stated that the Ho Chi Minh City real estate market is the largest in the country in terms of scale, entities, and geographical area. This region is considered the "heart and soul" of Vietnam's real estate market.

"I believe the market in Ho Chi Minh City and its surrounding areas is more market-oriented, while the Hanoi market is somewhat driven by expectations," Mr. Chung said.

Meanwhile, Mr. Nguyen Van Dinh, Chairman of the Vietnam Real Estate Brokers Association, believes that there are almost no significant differences between the two markets in terms of buying and selling activities, institutions, planning, and demand. However, in the Hanoi market, besides housing demand, investment demand is also very high; the investment potential of the Hanoi market is quite strong. In Ho Chi Minh City and its surrounding areas, housing demand is more dominant.

Source: https://www.congluan.vn/xu-huong-la-cua-bat-dong-san-nha-o-tp-hcm-phai-chang-da-cham-dinh-post319499.html