Escalating apartment prices delay Hanoi homebuyers’ plans

Yen, an office worker who has been saving eight years for an apartment, will be unlikely to be able to buy a new apartment before the Lunar New Year holiday next week, as most units she went to have seen prices surging in recent months.

A 70-square-meter apartment in Ha Dong District was priced at VND2 billion ($82,000) the same time last year and is now VND2.4 billion, up 20%.

Similar projects have risen at the same rate, and some have seen prices doubled in five years.

Yen, who has saved VND1.5 billion and plans to borrow VND800 million more for a new home, will now have to postpone her plan to become a homeowner.

“Old apartment building prices are rising unusually. I will have to rent for another year to save more.”

An, who works for a tech company in CauGiay District, said that at VND2.3 billion, he could have bought a two-bedroom apartment earlier last year in Nam Tu Liem District, but now he can only buy a one-bedroom.

He has to postpone his purchase plan as the apartment is too small for a family of three.

Nguyen Quoc Anh, deputy CEO of property listing platform Batdongsan, said that property prices often fluctuate strongly during the first weeks of the year as people want to buy a new home before the traditional Tet holiday.

Data from Batdongsan shows that Hanoi apartment prices have risen by 6-9% throughout 2023.

Nguyen Hoai An, a senior director at CBRE Hanoi, said that apartments priced in the VND2-3 billion range were affordable to the majority of homebuyers and therefore they are sought-after.

CBRE data shows that prices of apartments on the secondary market (where buyers sell to other buyers) had risen 32% from 2018 to VND33 million per square meter last year.

Anh said that interest rates for buyers remained ata high level and therefore people prefer to push back their purchase plans this year.

“Renting is now the only option for many people,” he added.