31st Sea Games - Vietnam 2021 Covid-19 Pandemic
Home / Economy / Real estate
Lack of budget housing challenges Hanoi property market
Ngoc Mai - Doan Thanh 08:07, 2022/03/13
The average prices of new apartments for sale in Hanoi in 2022 are from VND30 million (US$1,311) per square meter onwards, which target customers of middle- and high-income groups.

A lack of low-cost housing projects continues to be a major issue of the Hanoi property market in 2022, as most of those which will be completed in 2022 or open for sale are mostly of mid and high-end segments.

Data from the real estate website batdongsan.com.vn suggested the average prices of new apartments for sale in 2022 are from VND30 million (US$1,311) per square meter onwards, which target customers of middle to high-income groups.

 A housing project in Hanoi. Photo: Doan Thanh

These include the Park Home project (Cau Giay District) from VND38-42 million per square meter; The Nine (Cau Giay) with those priced at VND42-50 million; Trinity Tower (Thanh Xuan District) VND38.5 million; Mipec Rubik 360 (Cau Giay) VND48-53 million.

After a difficult period of struggling with the Covid-19 impacts, Hanoi’s real estate market has seen positive signs over the recovery and growth prospects.

However, future sources of supplies would mostly be concentrated in suburban districts, including Hoai Duc, Dong Anh, Thanh Tri, Gia Lam, or Dan Phuong.

“We see a shift in investment trend to districts surrounding the downtown of Hanoi, due to the high investment cost and low rate of return in the metropolitan area,” Senior Director of Advisory Services at Savills Hanoi Do Thu Hang told The Hanoi Times.

“Investors are looking for business opportunities in rural districts and even of neighboring cities/provinces to Hanoi such as Hung Yen, Bac Ninh, Quang Ninh, or Haiphong,” she added.

While the move may partly relieve pressure from rising housing prices in downtown Hanoi, the imbalance of supplies has distorted the supply and demand.

A representative of the Department of Housing and Real Estate Management under the Ministry of Construction admitted the lack of social housing projects or budget commercial houses, which poses a stark contrast to an abundant supply of luxury housing in Hanoi and Ho Chi Minh City.

“This could lead to an unstable development of the real estate market, especially as mid-and high-priced housing projects are making up 90% of the supply in the market,” he added.

A national housing development strategy for the 2021-2030 period, with a vision to 2045, sets the goal of ensuring sufficient supply of affordable houses for low and middle-income groups, seen as a key factor for the market’s sustainability.

Under current regulations, the Government has now given greater authority to provinces/cities in licensing housing projects. As such, only projects of up to 300 hectares or in residential areas of over 50,000 people would need approval by the prime minister.

Vice Chairman of the Hanoi Real Estate Club Nguyen The Diep said simplified procedures would speed up the housing approval process, but called for drastic measures from local authorities to address the imbalance in housing supply.

“There should be a halt or limit the issuance of construction licenses for luxury housing projects, and give priority to budget ones,” Diep told The Hanoi Times.

“A strict process from the beginning is the key step to fix the current imbalance in the real estate market,” he added.

TAG: housing projects hanoi Real estate Hanoi property hanoi
Other news
07:35, 2022/35/19
Vietnam PM sets up taskforce to address difficulties in real estate market
In recent months, the market has experienced a significant decline in transactions, as many projects have not been able to proceed due to lack of capital.
16:22, 2022/22/14
[Infographic] Hanoi housing development program in 2021-2030
The capital city will allocate more than 1,800ha for housing development.
09:37, 2022/37/07
Future property projects to be located in Hanoi’s west and central areas
About 103,000 new apartments in the city are estimated available for sale from the last quarter of 2022 to 2025.
17:30, 2022/30/04
Hanoi announces eight housing projects available for foreign owners
Foreigners can buy and own a maximum of 30% of the total number of apartments in a building, according to the draft amendment to Vietnam's Housing Law.
17:17, 2022/17/21
Land prices in Hanoi in upward trend
It is expected that by late 2022, real estate demands would continue to stay low and investors may be forced to lower prices to attract buyers.
16:21, 2022/21/19
Hanoi Grade A office rents to slightly rise in last months of 2022
Total new supply in Hanoi office market is estimated at 103,600 square meters in 2022.