Ahead of time: The rise of young homeowners in Vietnam

The 19-year-old boy from northern Bac Giang province, who financed the apartment himself, expressed satisfaction with his purchase.

“If I hadn’t bought the apartment, I would have spent nearly VND300 million on rent during my four years at university,” he said. “Acquiring a house before I turn 30 has always been one of my objectives.”

Nam embarked on a career as a gaming content creator on YouTube and TikTok four years prior. Within a few months, he witnessed a steady rise in his income, eventually earning between VND60-80 million each month.

Upon his admission to a university in Hanoi, Nam began contemplating homeownership in the city. His savings already totaled more than 50% of the value of the house he had in mind. So, he borrowed the rest from his mother and uncle, and committed to paying it back monthly.

To ensure he has enough income to pay his mortgage, Nam has been both studying and taking on additional work to build TikTok channels as a service to KOLs and KOCs (influencers on social networks).

Nguyen Quang Nam, a social media content creator, manages his mortgage payments for a Hanoi house as of December 2023. Photo courtesy of Nam

In the south, 28-year-old An Giang native Nguyen Phuoc Xuyen bought a 52-square-meter apartment for VND2 billion in Thu Duc City (HCMC) after two years of working four jobs at the same time.

Growing up in a farming family, Xuyen started planning to buy his own house in 2016, while he was an English language student at Ho Chi Minh City University of Finance and Marketing. At the time he was working as a part-time freelancer for media and advertising companies.

In 2018, Xuyen graduated from school with VND85 million in savings. He then borrowed VND100 million from a bank to open a private dormitory business. Two years later, the project broke even and began to make a profit. Xuyen quickly had an additional VND150 million.

However, the finish line still seemed distant.

The young man had to work four jobs at once, including his dormitory business, advertising writing, beauty queen assistant, and as a real estate broker, to make a total income of around VND30 million per month.

Xuyen’s working hours usually last 12-14 hours a day. He manages his living expenses such as rent, meals, shopping, and birthdays using a financial management app to ensure that they do not account for more than -third of his income.

In early 2020, Xuyen wanted to complete his plan, so he began “surfing” investments with a friend, which meant buying back incomplete real estate projects. He invested VND150 million, about 15% of the value of the apartment he wanted to buy, in buying and then reselling properties.

After three successful deals, Xuyen pocketed a profit of 240 million, allowing him to make a deposit on his apartment in Thu Duc City. The rest he borrowed from the bank at an interest rate of 7.8%. In the middle of that year, Xuyen received the house and decided to rent it out for VND6.5 million a month, and he moved out to a hostel.

“I want to optimize costs to cover the installment payment of nearly VND8 million per month,” Xuyen said. “Renting the new apartment makes it easier for me to pay my rent.”

Xuyen and Nam are two examples of how the average age of Vietnamese homeowners is shifting and getting younger.

Asurvey by real estate technology group Property Guru showed that people aged 26-42 driving the highest demand for properties in 2023. Individuals aged 27-30 accounts for 42% of this demographic, while those aged 32-40 makes up 24%. In stark contrast, about 15% of real estate seekers are over the age of 42.

Further emphasizing this trend, Property Guru noted a marked increase in real estate investment interest among the Gen Z and Gen Y populations, all under 35 years, as evidenced by their growing online searches over the last three years.

A consumer psychology survey by real estate research company and buying-selling platform Batdongsan for 2024 showed that a substantial 64% of prospective real estate buyers are under the age of 39.

Ngo Thanh Huan, the director of personal finance at FIDT, an investment consulting and asset management firm, observed a significant increase of 70% in 2023 in real estate purchases by customers under 40 years old.

He attributes this shift to the advancements in information technology, which have generated numerous high-paying job opportunities for the Gen Y and Gen Z cohorts. These opportunities often offer salaries significantly higher than those available to the preceding generation, empowering younger individuals with greater purchasing power in the real estate market.

A Batdongsan survey focusing on customers below 30 years old highlighted that many young people are open to purchasing real estate in less central locations, often opting for properties on the outskirts of major cities.

This trend is exemplified by Minh Trung, who at 26, successfully bought an apartment using his own finances.

Minh Trung, at 26, buys his own apartment using his savings. Photo courtesy of Trung

Four years ago, he purchased an apartment on Pham The Hien Street, District 8, Ho Chi Minh City. He acknowledges his fortunate timing, having established a financial plan for home ownership during a period when the economy was more accommodating.

He started his business with two dental equipment companies, taught English, and invested in stocks. At that time, Trung had an income of about 60-100 million VND per month. He had accumulated 30% of the 72-square-meter apartment value of VND1.2 billion in September 2017.

When Trung made a deposit, the apartment was still a project. Every two months, Trung pays 10% of the house value. To keep up with this pace, Trung had to move from an apartment he used to rent for 7 million a month to a rented room for three million, minimizing all types of expenses. He received the house in January 2020 at the age of 26.

Three years later, the economic recession caused Trung’s income to decrease by about 70%, but he still felt lucky to have an apartment as an accumulated asset. “If I hadn’t decided at that time, I wouldn’t have been able to buy a home,” Trung said.

Expert Ngo Thanh Huan affirmed that with current conditions, it is not too difficult for young people to buy a house on their own as long as they know how to gain economic knowledge, set clear goals, and adhere financial plans.

“They need to have accumulated assets from VND300 million to VND2 billion to have options for owning real estate,” Mr. Huan said. In addition, they also need to prepare for other risks such as fluctuating interest rates, illness, or unexpected incidents, he said. .

Xuyen said that in early 2023, he faced a crisis when interest rates suddenly increased to nearly 14%, equivalent to having to pay 18 million per month. The young man from An Giang was forced to quit his job in advertising to work at an insurance company, and also took on the job of managing a vegetarian restaurant in Ho Chi Minh City. He was then able to maintain an income of 40-50 million a month, just enough to manage.

One evening in early 2024, Xuyen opened the computer and entered the income and expenditure figures for the month, showing that he had paid 60% of the house’s value.

“I will move into the apartment after paying off the debt,” Xuyen said. “Settling down is the first step to a happy career.”