Where does the apartment fever come from?

Apartment prices continue to increase

Since the end of last year, apartment prices have increased rapidly. Price increases do not only occur in new projects but also in used projects.

Ms. Nguyen Anh Dao (in Hanoi) said last November she had the idea She wanted to buy an apartment in Hoang Mai district (Hanoi) to rent. She didn’t have enough money to buy it, so she waited. At that time, the broker advised her on a 64m2 apartment priced at 23 billion VND (about 36 million VND/m2). ). In early March, the price increased to 265 billion VND, an increase of 300 million VND after only 3 months.

For many years working as a broker selling apartments in Hanoi, but Mr. Tran Huy Thuc also has to admit that the recent increase in apartment prices is unexpected. According to Mr. Thuc, many of his customers have “lost” hundreds of millions VND when selling my apartment 2-3 months ago.

“Before Lunar New Year, I sold to customers an apartment in Thanh Xuan district with an area of ​​70m2 for 35 billion VND. Now a similar apartment in the same apartment building above is being sold for 38 billion VND, equivalent to about 54 million VND/m2,” Mr. Thuc gave as an example.

According to a survey by reporter Dan Tri On some current real estate information pages in Thanh Xuan district Hoang Mai Ha Dong, selling prices of apartments in old apartments range from 35-60 million VND/m2.

Some apartments Old apartments in Hoai Duc district have a “softer” price of up to 35-42 million VND/m2. Similarly, the selling price of apartments in new projects put into use in Thanh Tri district is 3-5 billion VND more than up to 25-3 billion VND for a 65m2 apartment.

According to research data of the Vietnam Association of Real Estate Brokers (VARS), in recent years, on average, apartment prices have grown twofold each year. digits. In 2023 alone, the apartment price index in Hanoi at the end of 2023 increased by 16 percentage points compared to the beginning of the year.

Also according to this unit, apartment projects in the cities The city is constantly setting new price levels, and rents for old and new apartments in residential areas are constantly increasing. Especially since mid-2022 when rental contracts during the peak of the epidemic will expire and be renewed if both parties continue to have needs. Many apartments have increased in price by up to 40% compared to the peak of the epidemic and increased by about 20% compared to mid-2022.

Why are apartment prices “fever”?

Explaining the current situation of apartment price increases, many real estate experts believe that the main reason is the lack of supply in the market.

Mr. Nguyen Van Dinh – Chairman of VARS – said Apartment supply in Hanoi City is really scarce. The number of projects has been increasingly limited in recent years while the demand from customers, especially young families, is still large.

In addition, according to Mr. Dinh, the reason is also due to the product structure on the market. The lack of balance causes apartment prices in the primary and secondary segments to rise. As a result, people with real needs for housing lose access.

In the short term, Dong Dinh forecasts that apartment prices in the centers of major cities will continue to maintain an upward momentum, especially in mid-range segment. Meanwhile, the purchase and resale prices of high-end luxury projects may record a slight decrease.

Agree, Mr. Nguyen The Diep, Vice President of Hanoi Real Estate Club, said that in recent times, urban infrastructure has developed, many highway projects, ring roads, bridges over the Red River… have been invested in and built, making connectivity possible. between these areas and the center is increasingly favorable, thereby causing real estate prices to increase.

Related to this issue, statistics from the Ministry of Construction show that with population growth and housing demand, Currently, the country needs about 70 million square meters of urban housing each year.

However, in the context of scarce supply, the annual shortage will be about 300,000 housing units pushing house prices are increasing, especially in the affordable and mid-range apartment segments.

Many real estate experts predict that because the supply cannot be improved soon, House price pressure in major cities, including Hanoi, will continue to increase in 2024 and even continue in the next few years.