Parking an expensive headache for Hanoi apartment owners

For the first time in two years, Phuong Linh in Hanoi’s Ha Dong District was able to park her car in the basement of her own apartment building after paying VND20 million to a neighbor who just moved away.

Due to the limited space in the basement, Linh has been parking her car in other parking lots around her neighborhood ever since she moved to the building.

Only car owners who registered early can park their vehicles in the basement, and once they move, other residents like Linh rush to purchase the right to park in the spaces they leave vacant.

This means that on top of the VND20 million, she still has to pay monthly parking fees.

"I have to pay a lot, but I consider myself lucky. There are 30 other residents like me waiting for the next empty parking slot."

Stories like Linh’s have become increasingly popular in Hanoi, a city of 8.4 million where the number of both condominiums and cars has been surging in recent years.

Manh Dung in Nam Tu Liem District last month bought an SUV, but he only found out after the purchase that there were no car parking spots left in his building.

Nearly 100 residents have queued for the next empty slot, he said.

Using connections, Dung managed to contact one of the building managers and secured a parking slot for VND40 million. The deal was unofficial.

The manager said that if he moves away in the future, he can sell the slot for almost the same price, as there will always be demand for parking slots in the building.

"I paid right away. A basement parking space is valuable, especially when it rains."

Many developers have set aside auto parking areas in the basement of their buildings, but the increasing number of cars in the city has made the limited number of parking slots a treasured real estate.

By February this year Hanoi had over one million cars, up 36% from around the same period in 2019. This means that one in every eight Hanoi residents owns a car.

Some developers, therefore, charge big bucks for parking slots.

A developer of a 40-floor condominium in Ha Dong District earlier this year charged VND220 million for a 20-year parking space rental contract.

It also offered to sell a parking slot permanently at VND400 million for a sedan, and nearly VND500 million for an SUV.

Due to the high price tag, some residents at the building have no choice but to find outdoor neighborhood parking lots and pay around VND1.2 million a month per vehicle.

In July, a developer of a 30-floor building in Thanh Xuan District charged VND60 million upfront for a five-year car parking slot. Residents protested the policy, saying that they did not want to pay such a hefty sum all at once.

The developer also offered to lease a parking slot for VND200 million over 40 years. This means that a resident of a 70-square-meter apartment in the building would have to pay 10% of their apartment price for parking.

Nguyen Viet Huy, a lecturer at Hanoi University of Construction, said that the competition for car parking space at condominiums has become more popular in Hanoi in recent years.

There are legal requirements on how much parking space is needed at every condo project, but the figures are not backed by any scientific study, he added.

Dao Ngoc Nghiem, deputy chairman of Hanoi Urban Development Planning Association, said that many developers who built their projects 10 years ago did not expect the number of immigrants in Hanoi would rise as fast at around 1.4% annually.

"Parking space therefore have become one of the top criteria in apartment purchasing these days."

The lack of public parking spaces also contributes to the issue, as only 10% of parking demand in Hanoi has been met, he said, adding that more elevated and underground parking lots should be built.