HCMC apartment rents rise by 15% as supply slumps to 15-year low

Thien Minh has just moved from his rented apartment in Thu Duc City to a newly purchased one in District 7.

His decision to move came after his landlord raised the rent by 12.8% from last year to VND22 million (US$865) a month last quarter, or more than the monthly mortgage payment he makes on his new home.

Hoang Phuc, a real estate broker, said rents of medium- and high-priced apartments in good locations have increased by 10-15% from a year ago.

According to data from online real estate trading platform Nha Tot, rents have risen sharply in more than half of the city’s districts in the last 12 months.

In Thu Duc City they are up 12.4% to VND10.3 million.

Rents in District 4 have increased by 17% and in Phu Nhuan District by 28% to VND13.5 million and VND9.6 million a month.

A report from property consultancy JLL said the average monthly rent in HCMC was $10 per square meter last quarter, up 1.6% from the last quarter of 2023 and 5.9% year-on-year.

Most of the increases are at new and high-quality projects while the rest of the market is mostly steady, it said.

Properties along the Hanoi Highway in HCMC's Thu Duc City in February 2024. Photo by VnExpress/Quynh Tran

Roddy Allan, Asia-Pacific chief research officer at JLL, told CNBC that HCMC, Jakarta, Bangkok, and Manila are four cities with notable rental growth in developing Asia-Pacific.

"Vietnam’s largest city, Ho Chi Minh City, was also one of the region’s [best] performing markets from a residential perspective."

Apartment rents have been rising as new supply has been falling to record lows.

Last quarter only around 500 new apartments entered the market, most of them at existing projects, according to real estate services provider CBRE.

This marked an 83% year-on-year decrease and the lowest quarterly figure in the last 15 years, the firm added.