Hanoi landlords cite inflation, hike housing rents

Thuy Ngan in Hanoi’s Khuong Dinh Ward decided this month to move to a new apartment after her landlord asked for a 10% rent hike for her 20-square-meter unit from VND3.8 million (US$144) a month to VND4.2 million from September.

"Inflation is high, all prices are rising, and so the rent cannot stay the same," the landlord told her.

Ngan says with electricity, water sanitation and other fees, her total monthly bill came to nearly VND5 million, a third of her income.

An apartment building for rent in Hanoi. Photo by VnExpress/Ngoc Diem

She moved to a new apartment five kilometers away with a 10% lower rent, accepting a longer commute in exchange.

Quang Huy and his wife in Cau Giay Ward were shocked when their rent was raised by 15% to VND9 million from October after their lease expires this month.

Their 38-square-meter unit, with two bedrooms and a living room, is in a seven-story apartment building.

The landlord said the property had been repainted and renovated, and so the rent would be higher.

"With students moving in, there is no shortage of tenants" if they disagreed, they were told bluntly.

After nearly two weeks of searching in the same area Huy could not find a comparable apartment.

The two are now considering moving farther out to rent an old apartment.

Nguyen Tuan Anh, who manages a rental company with 50 units in Hanoi, says many landlords have raised rents by 10–15%.

The main reasons they give are inflation, higher property prices and increased cost of furnishing, he says.

The consumer price index rose by 3.24% year-on-year last month, according to the General Statistics Office.

Household electricity and water prices increased by 10.8% and 3.9% among others.

Meanwhile, demand for rental housing in Hanoi rose by 11% in July from the previous month, data from property portal Batdongsan shows.

Since March house rents have gone up by 10%, and up to 15% in the case of small units.

Pham Duc Toan, CEO of property developer EZ Property, says rental demand in big cities is consistently high.

Hanoi and HCMC are the top destinations for migration, with 22% of respondents citing better job opportunities as the reason, according to the 2023 Provincial Governance and Public Administration Performance Index.

In Hanoi, rising property prices this year have caused landlords and investors to expect higher rents.

Combined with the general price rise, this has pushed up rents.

"When living costs and the prices of goods and services rise, landlords also tend to increase rents," Toan says.

Nguyen Chi Thanh, vice chairman of the Vietnam Association of Realtors (VARS), says the annual school and university opening time in September is a peak rental period, with demand 20–30% higher than in other quarters.

This is also when leases often expire, he says.

But with the economy still under strain and incomes not rising, people are lowering their living standards, opting for smaller, less central and more modest housing to manage costs, he adds.

A recent VnExpress survey of more than 7,800 readers found that nearly 1,100, or 14%, said they planned to leave Hanoi and return to their hometowns because of high costs of both renting and buying housing.

Experts say social housing is an effective solution to ease pressure on rents.

Toan suggests boosting social housing supply by offering more interest rate and tax incentives, and improving access to land to attract developers.