Hanoi’s 5-year high housing supply fails to bring down prices

By Ngoc Diem October 11, 2024 | 12:32 am PT

Apartment buildings in Hanoi. Photo by VnExpress/Ngoc Thanh

Hanoi apartment and landed property prices show no sign of cooling down even though new supply has reached a five-year high in the first nine months, a new report has found.

Between January and September new apartment supply reached 19,000 units, exceeding 2023’s total, Nguyen Hoai An, senior director of property consultancy CBRE Hanoi, said at a press briefing Tuesday.

In the same period 3,500 new landed units became available. Both figures were highest in five years, she said.

The capital is set to see 30,000 landed units and 5,000 apartments becoming available this year, she added.

"2024 will end Hanoi’s four years of low housing supply."

Prices, however, remain high and out of reach for most citizens.

Around 75% of new apartment supply in the third quarter were priced VND60 million (US$2,415.46) per square meter, and average price has gone up 26% year-on-year.

Average landed property price has gone up 27% to VND235 million per square meter.

Another property consultancy, Savills, shows that only 1% of apartments are now priced VND2 billion or less, which demonstrates a severe lack of balance in supply.

Pham Duc Toan, CEO of developer EZ Property, said that developers have been demanding high prices and therefore sellers have also been raising their listing prices. This makes the market unsustainable, he added.

An said that most new houses and apartments are located in crowded areas where prices are already high. Developers therefore need to ensure their profits will reach expected targets amid high construction costs.