HCMC property rents bounce back from Covid lows

By Vu Le   January 5, 2023 | 08:33 pm PT
HCMC property rents bounce back from Covid lows
Office and retail buildings in HCMC’s central business district. Photo by VnExpress/Quynh Tran
Rental properties in HCMC saw demand recover and rents surge by up to 30% in 2022 after falling sharply the previous year.

All segments, including offices, apartments, townhouses, and retail space began to recover after the first quarter, and boomed in the fourth, from the gloom caused by the Covid outbreak.

Real estate website Batdongsan’s rental market report said in the fourth quarter interest in properties for rent, as shown by searches on its platform, increased by 103% year-on-year.

The breakdown included 244% for offices, 263% for townhouses, and 57% for apartments, it said.

Rents too rose sharply during the quarter.

They increased by 15-18% in districts 3, 7 and 9 and 23-31% in districts Binh Thanh and 4 in the case of apartments. Townhouse rents in districts 3 and Phu Nhuan rose by 5-10% and in districts 1, 7 and 10, by 13-18%.

Office buildings also saw high occupancy rates and rents in the final quarter. Statistics from property firms VNO with more than 10 office buildings showed that occupancy rates in the affordable segment, which cost $15-20 per square meter per month, stood at 85-90%.

The rents represented a 3-5% increase year-on-year. Property consultancy Knight Frank said rents for grade A space rose by 2.6% year-on-year. Recovery was also seen in the retail space segment.

According to Cushman & Wakefield, the average rent was $49.3 per square meter, up 9.1%, while occupancy was nearly 90%.

Le Quoc Kien, an expert in home-for-lease investment, said the market recovered after the second quarter because the city economy recovered after being knocked out by the pandemic in 2021.

But the rise in rents was uneven, and they were yet to return to 2018-19 levels. He forecast more apartments and townhouses for rent to enter the market in 2023 when new projects would be completed and investors lease out properties after being unable to find buyers in 2022.

Then, rents would drop slightly or move sideways, he added.

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