Why Vietnam still lacks retirement homes for its aging population

There are 16.1 million people aged 60 and above in the country, or 16% of the population. It is set to rise to 20% by 2038 and 25% by 2050.

Experts say elderly care can become profitable for the real estate and services sectors.

Data from the Vietnam Association of Realtors (VARS) shows the country has only a few dozen assisted living facilities, both public and private, with most offering only basic care and lacking specialized services such as medical treatment, nutrition and communal activities.

HCMC had seven public and 13 private facilities in 2024, six of them free and run with donor funding.

Elderly residents at the Thi Nghe Nursing Center in HCMC. Photo by VnExpress/Quynh Tran

Some major developers have shown interest in building and operating retirement homes notwithstanding requirements like vast areas of land, long-term capital and a workforce with expertise in healthcare and social care. It also yields lower profits than commercial housing.

Vingroup has partnered with Japan’s Well Group to develop a luxury facility in Hanoi.

Sun Group announced the Sun Urban City project in Ha Nam Ward with a hospital, senior living facilities and community spaces.

Tran Anh Group has earmarked more than 20 hectares of land in Long An Province for building a premium retirement home.

Novaland and VinaLiving have announced plans in Phan Thiet and Quy Nhon.

A HCMC real estate developer said the biggest hurdle to developing retirement housing is the lack of a legal framework.

Another obstacle is the low incomes of seniors in Vietnam, where the average monthly pension at the end of last year was around VND6.2 million (US$230).

VARS’s Institute of Real Estate (VARS IRE) said basic elderly care services in major cities cost at least VND10 million ($380) a month, while premium packages cost VND16-22 million ($610-830).

Pensions are rising at 5-7% a year and senior care costs at 10-15%.

In developed countries, most senior care expenses are borne by insurance or the government while in Vietnam the onus is on families.

"As long as costs are higher than incomes, demand alone will not be enough to encourage investment," VARS IRE said.

A retirement home in Dong Thap Province, Vietnam. Photo by VnExpress/Ngoc Tai

Pham Thi Mien, deputy director of VARS IRE, said inconsistent policies and regulations mean investors are concerned about cash flows and profits.

"Senior housing must be profitable to be sustainable or else it will face the same problems as social housing."

Nguyen Van Dinh, vice chairman of VARS, said retirements homes in Vietnam lack governmental support and so investors are cautious.

He said the aging population would create opportunities for businesses that enter the market early.

Experts agreed that the government should provide land, credit and tax breaks, and improve the legal framework for senior housing.

They said setting up small and medium-sized adult daycare centers, where seniors only stay for the day, near populated areas is a practical solution.

These should provide basic services and shared spaces while meeting medical and emotional needs.

At a recent conference, Party General Secretary To Lam said adult daycare centers are a suitable model for the aging Vietnamese population but progress has been slow.

He encouraged the private sector to participate in the industry and noted that elderly people are often left alone during the day while their families are at work or school.