Supply of apartment units in Vietnam may rise 33% next year: expert

Vietnam’s property market is expected to see the entry of 35,000-40,000 apartment units in 2025, up 33% from 2024, says Duong Thuy Dung, executive director, head of professional services at CBRE Vietnam.

This year, the market is expected to have welcomed approximately 30,000 apartment units, with 80% of the supply originating from Hanoi.

With this expected rise in supply, the property market is poised for significant recovery next year, although it will take considerable time to return to its peak levels, Dung noted.

Dung also highlighted that real estate prices show no signs of decreasing, and there is no apparent reason for developers to lower their selling prices.

With 80% of the current property supply comprising high-end apartments, property prices may rise by 8-10% annually starting 2025, she predicted.

To address the stubbornly high real estate prices, Dung suggested promoting population dispersion and expanding urban development. She cited Ho Chi Minh City as an example, where apartment prices in central district areas range from VND150-200 million ($5,890-$7,850) per square meter, compared to VND40-50 million ($1,570-$1,960) in suburban areas.

Consequently, prices could decline if more people were willing to move farther from downtown city. However, she estimated that this shift could take another five to 10 years.

Dinh The Hien, an economist, expressed concern over the rapid escalation of property prices, which has made homeownership increasingly unattainable for many people.

He pointed out that in 2012-2013, mid-end apartments in HCMC were priced at VND22-25 million ($864-982) per sqm. After a decade, these figures have more than doubled to VND50-65 million ($1,960-$2,553). Meanwhile, the average monthly wage of a senior office worker in the city has risen by only VND5 million ($196) to VND25 million ($982) over the same period.

While the economy is recovering, with strong growth in the production and business sectors, cash flow into the real estate market remains constrained, Hien stated. Banks are currently hesitant to disburse new capital to real estate businesses due to high risks, leaving many developers in dire need of funds, he added.

According to the Vietnam Association of Realtors (VARS), home prices in Vietnam have recorded an average annual double-digit growth over the past decade. Affordable apartments, priced under VND25 million ($982) per sqm, have become virtually “extinct” in the market in recent years.