Vietnam’s Property Market: A 2024 Boom with 81,000 Units Available for Sale
Vietnam’s property market wrapped up 2024 with impressive momentum, showcasing a significant recovery driven by enhancements in the regulatory framework and increased transparency for stakeholders. Nearly 81,000 residential units became available for sale this year, marking a striking rise of over 40% from 2023. Let’s dive into the details of this invigorating market and dissect the factors contributing to its resurgence.
Surge in Housing Supply
2024 witnessed a robust influx of residential properties as several large projects launched towards the year’s end, supported by flexible payment options. By year-end, around 56,000 units were actively listed on the primary market, a reflection of successful project sell-offs. Altogether, approximately 81,000 units were up for sale—this included more than 65,300 new listings, nearly tripling last year’s figures. The fourth quarter alone saw a remarkable 28,000 new listings, quadrupling the offerings from the same period in 2023, illustrating the rapid growth of the market.
More than 47,000 units were successfully transacted by the end of the year, culminating in a commendable absorption rate of 72%. This demand was fueled by ongoing urbanization and economic growth, particularly notable was the fact that investment demand constituted over half of the primary market’s transactions.
Thriving Condominium Market
The condominium sector stood out dramatically, accounting for 75% of all transactions. New projects reported absorption rates exceeding 70%, and several managed over 90% during their initial sales phase. As conditions improved, the volume of property transfers rose steadily throughout the year. Low-rise properties also performed admirably, with new project absorption rates hitting 65%, equating to nearly 9,000 successful transactions. An impressive 60% of these transactions stemmed from two substantial urban projects by Vinhomes.
In the secondary market, liquidity predominantly gravitated toward properties that met genuine housing needs. The allure of completed urban projects equipped with modern amenities and infrastructures offered housing options priced below VND4 billion (around US$157,168), appealing to a wide array of buyers.
The Land Segment and Investor Preferences
In the land market segment, primary sales prices surged, showing little indication of stabilization, thus impacting the secondary condominium market, where prices remained significantly inflated. Nevertheless, overall supply and liquidity were deemed average.
Transactions primarily occurred within the secondary market, where new regulations mandated developers to construct homes for sale. Larger plots lacking legal titles witnessed price dips, while subdivided plots with clear titles captivated investor interest. Increasingly, subdivided land plots priced below VND30 million ($1,178) per square meter garnered significant attention in urban areas with robust infrastructure, witnessing price hikes of approximately 15% since last year.
As property prices in major cities like Hanoi and Ho Chi Minh City soared beyond many buyers’ budgets, investors began pivoting towards outlying provinces. These areas offered affordable prices and substantial growth potential, spurred by improvements in infrastructure and urban planning.
Shifting Dynamics in Investor Focus
Though liquidity in the luxury property segment demonstrated a slight decline, stability characterized the market for residential properties that addressed genuine housing needs. These properties provided reasonable pricing alongside essential amenities—key factors attracting buyers. The Vietnam Association of Realtors advocates for developers to align pricing strategies with market purchasing power, emphasizing the need for a sustainable recovery rather than a focus on short-term profits.
Looking toward 2025, discerning investors are likely to pursue opportunities in real estate projects that leverage advanced technology to enhance management efficiency and boost value. Smart management systems are particularly appealing to younger homebuyers who prioritize innovation.
However, challenges persist as many real estate firms face daunting pressures stemming from high leverage and restricted repayment capacities, with around 60% reporting difficulties in achieving their financial objectives for 2024. This underscores the necessity for strategic market navigation amid the evolving landscape.
With its dynamic changes, Vietnam’s property market offers a compelling case for ongoing investment prospects as it continues to adapt and reshape in response to both local and global trends.