Hanoi apartment prices double in 10 years

Hoang Hung of Vinh Tuy Ward recently learned that his two-bedroom house is now priced at VND109 million per square meter; he had bought it at VND45 million in 2016.

He and his wife wanted to sell it to buy a three-bedroom unit, but the latter is now out of reach for them, with prices of most apartments 2.5 times higher over the last decade.

"We were lucky to have bought earlier since at current prices we will struggle to buy even a one-bedroom apartment," he said.

Buildings in downtown Hanoi. Photo by VnExpress/Ngoc Thanh

Nearby, the VND100 million price tag has become common. At a 26-floor tower in the same ward, a three-bedroom unit is priced at VND107 million per square meter, 2.6 times its price at launch in 2017.

Data from listing platform Batdongsan shows asking prices across Hanoi have exceeded VND100 million per square meter in the third quarter.

From a year ago prices have risen by 39% at Royal City, 36% at Park View City, 32% at Hinode City, and 29% at Times City.

Real estate agent Hong Nhung, who focuses on the secondary market, said this year prices at many central locations have jumped by 20-30%, prompting many would-be buyers to abandon plans for larger homes and instead renovate their existing apartments rather than pay the large difference.

First-time buyers tend to look far away from the central area for new projects offering longer payment plans and lower prices, she added.

Analysts said the rising prices make it harder even for high-income groups to buy. Nguyen Van Dinh, chairman of the Vietnam Association of Real Estate Brokers, said even young clients earning VND40-50 million a month (five or six times the average Hanoi income) are unable to afford to buy a home and choose to rent one.

At a recent meeting Prime Minister Pham Minh Chinh acknowledged that most housing products are expensive and experience sudden price spikes, especially in major cities.

"Many people need homes but cannot buy because prices are too high. When apartments cost VND70 million or VND100 million per square meter, who can afford them?"

Dinh called for stronger government support for development of affordable housing. He added that work on infrastructure such as ring roads, metros and highways must be sped up so that people are comfortable buying houses in suburban areas.

Pham Duc Toan, CEO of property developer EZ Property, said the imbalance in the housing market stems from developers focusing on high-profit projects.

Affordable housing and small-scale urban developments in provinces "always have strong demand and enable quick capital recovery," he added.