Property prices in Vietnam are set to climb next year when amended laws take effect, with improvements to the quantity and quality of projects reaching the market, said Le Bao Long, director of strategy at property website Batdongsan.com.vn, under Singaporean firm PropertyGuru.
The amended Land Law, set to kick in on January 1, 2025, is expected to push up land prices, which stayed flat last year, following the removal of land price brackets and annual updates of land prices, which were previously updated every five years.
In addition, increased site clearance costs and resettlement requirements for investors are likely to inflate costs, while the secondary market will be boosted by higher project transfer prices and tightened supply of land lots for division.
Furthermore, supplies of social housing are projected to climb thanks to incentives and new support policies under the amended Housing Law, which is due to come into effect on January 1, 2025, the expert noted. Accordingly, social housing projects will be allowed to access foreign capital and organization and trade union budgets set aside for workers to rent social housing.
New policies under the amended Law on Real Estate Business, also effective on January 1, 2025, will help screen out incompetent and unproductive developers with stricter requirements regarding their capabilities, Long said. Additionally, regulations governing deposit collections and payments will be tightened.
The new flexible rules on resettlement and land revocation will cater to the interests of customers, including overseas Vietnamese, he added.
Finally, the market management system will be tightened, ensuring greater control of brokerages and improved transparency.
A first-quarter report by Batdongsan.com.vn showed that the real estate market remains tepid, except for the apartment segment.
In Hanoi, apartment prices are neck and neck with those in Ho Chi Minh City, standing at VND46 million ($1,840) and VND48 million ($1,920) per square meter, respectively. These levels are respectively 1.7 and 1.5 times higher than those recorded in 2018.
Prices of mid-end apartments in Hanoi saw record year-on-year growth of 19% in the third quarter of 2023, while those for high-end and budget apartments hiked 17% and 11%, respectively. Meanwhile, in HCMC, prices of high-end and mid-range apartments inched up 5% and 2%, respectively, and budget apartments dropped 4%.
Experts attributed the rise in Hanoi apartment prices to the thin supply of new projects and the popularity of mid- and high-range properties.
For example, the Masteri Homes-developed Lumiere EverGreen and CapitaLand-built Lumi Hanoi apartment projects, located in Hanoi's Nam Tu Liem district, are on offer for VND70 million ($2,804) per square meter. The Handico Complex in Thanh Xuan district is priced at VND62 million/square meter. The Wisteria, developed by Trading Construction Works Organization JSC in Hoai Duc district, has a price of VND40 million/square meter.
In HCMC, new apartment projects have increased, particularly in Thu Duc city. For instance, Eaton Park constructed by Gamuda Land is priced at VND120 million ($4,807) per square meter. The Aurora Phu My Hung in District 7 has a price of VND90 million per square meter, as does the Opus One project in Vinhomes Grand Park. Besides, the Privia project developed by Khang Dien House Trading and Investment JSC costs VND50 million/square meter.