HCMC townhouse, villa prices top $16,000 per square meter

Revealing this information, property consultancy JLL Vietnam said this marked a 10% year-on-year increase.

On the primary market, most townhouses were listed at VND190-215 million ($7,500-8,500) per square meter in the first quarter, up 2% from the previous quarter, real estate agency Avison Young Vietnam said.

Most new villas and townhouses launched during the quarter were in Thu Duc City and priced at over VND30 billion each, according to real estate consultancy Savills.

Prices exceeded VND400 million per square meter at some projects on Dien Bien Phu Street in Binh Thanh District, the Ministry of Construction noted.

Nguyen Loc Hanh, CEO of property developer Ngoc Chau A, said townhouse and villa prices increased due to limited supply as only a few dozen new units were launched in the first quarter.

Some villas were priced at over VND700 billion in Thu Duc City, he said.

This caused developers having inventories in nearby areas to hike their prices as well, causing average prices in the city to surge, he explained.

A townhouse project near Thu Duc City saw its prices jump from VND15-17 billion per unit at the beginning of the year to VND20-25 billion at the end of the first quarter, he said.

JLL added that the average price in the segment has also increased because lower-priced projects in the primary market have all been sold out.

Due to the high prices, the absorption rate was low at 20% during the quarter, property consulting firm DKRA.

Meanwhile, older inventories saw absorption rates of only 13%, Savills said.

Vo Hong Thang, director of consulting and project development at DKRA Group, said however that demand for villas and townhouses is declining due to low yields of 1-1.5% a year.

Many projects are in sparsely populated areas away from the city center and thus not great for businesses, but are still priced at record levels, he explained.

Looking to the rest of 2024, JLL expected HCMC to get 1,500 new townhouses and villas this year, most of them launched in the second half.

As buyers are cautiously observing the market instead of purchasing, the segment would only see demand if the new supply comes with cheaper price tags and favorable interest rates, it added.

Savills expected 4,800 new units to be added in the segment during 2024-26.