Over half of Hanoi’s new apartments are priced at $3,800 or more

One Mount Group said in a note that the rest of the supply was made up of units priced at VND50-100 million, adding that there was nothing below VND50 million in the market. New supply declined by 9% year-on-year to 8,100 units.

In some areas, prices have reached unprecedented levels. In Viet Hung Ward, average prices rose to a new peak of VND118 million per square meter, meaning a 50-sqm flat was priced at VND5.9 billion.

Data from property listing platform Batdongsan shows that Hanoi apartment prices have nearly doubled in the last two years.

Buildings in Hanoi. Photo by VnExpress/Ngoc Thanh

Prime Minister Pham Minh Chinh last month instructed the State Bank of Vietnam to assess lending needs for actual residential real estate amid signs of "speculation."

He also ordered audits of credit institutions that lend against property collateral to ensure there are no bad debts in future.

The Ministry of Construction has said "current selling prices do not reflect true value." The market suffers from stockpiling, price boosting and speculation that increase prices, causing supply-demand imbalances and exceeding the payment capacity of a majority of buyers, it said.

Current supply mainly consists of mid- and high-priced housing, and there is an absence of affordable housing suitable for most people, it said.

It has proposed loan caps for borrowers who already own at least one residential property: 50% for a second home and 30% for the third onward.