More than 10,400 luxury apartments – luxury and super luxury in Ho Chi Minh City in 2022

Ho Chi Minh City recorded up to 10,404 high-end, luxury, super-luxury apartments, accounting for 73.98% of the market and this segment is sold for from 40 million VND per m2 to goods.

Grand Marina Saigon

Grand Marina Saigon

Ho Chi Minh City Real Estate Association (HoREA) has just released a report on housing market in 2021 and trends in 2022. 2022

Accordingly, in 2021, the city recorded a total of 14,443 houses that were eligible to raise capital and offered for sale, in which affordable apartments accounted for 0%. This is the first year since the beginning of a new growth cycle in real estate (the milestone is 2016 until now), the supply of affordable apartments has no representative for sale to the market.

In contrast, the basket has 10,404 high-class, luxury and super-luxury apartments, accounting for 73.98%, the rest are houses in the mid-end segment, accounting for 26.02%. Affordable apartments according to this report, priced at around 25 million VND per square meter, mid-end apartments are priced at 25-40 million VND per square meter, and in the high-end segment - luxury and super-luxury, the selling price is from 40 million dong per m2 to hundreds of millions dong per m2.

Not only are affordable apartments increasingly scarce, the lower segment of social housing in Ho Chi Minh City also has not met the needs of the majority of people with low middle-income in urban areas.

According to HoREA, the product structure as of 2021 shows that the phase difference between housing supply and demand is reaching its peak and at an alarming rate. With affordable housing gradually disappearing while the risk of oversupply of high-priced housing is evident, the market falls into an unbalanced and unsustainable development.

According to the overview report of Ho Chi Minh City real estate market in the fourth quarter of 2021 by Savills Vietnam, the price of Grade C apartments and projects is selling at up to 56.5 million VND/m2, up 27%. By year. Some products have also increased their selling prices by 11% QoQ due to high prices in the new stage of sale or in the last apartments of projects with good construction progress.

Experts at Savills explained that the reason for the high selling price was the decline in the supply of primary housing for many years, especially the sharp decline due to the epidemic.

Specifically, in the apartment segment, although many investors quickly opened for sale and resumed business in the fourth quarter of 2021, with 7,820 units, equivalent to an increase of 160% quarter-on-quarter but down 31% year-on-year.

Considering the whole of last year, the total primary supply of apartments in Ho Chi Minh City was only 11,700 units, the lowest in the past 5 years and down 54% over the same period. However, with great demand from homebuyers, the absorption rate of the apartment product line still reached 81%, of which the Grade B segment led the transaction volume, accounting for 69% of the total transactions.

Returning to HoREA's report, this association said more about the transfer of housing projects, in 2021 only 1 project will be transferred due to problems because the transferor must have a Certificate ( red book), so it is very difficult to transfer projects. While, the conditions for transferring other projects (not real estate or housing projects) are very easy to transfer under the Investment Law, but Clause 2, Article 49 of the Law on Real Estate Business 2014 and point b, Clause 1 Article 194 of the 2013 Land Law.

The association also warned that the virtual fever, land price disorder associated with real estate speculation appeared in 2021 and is showing signs of returning in the first 2 months of this year. This requires state management agencies to pay attention to timely handling of real estate investors, brokers (brokers), businesses creating virtual fever to profit.

The Global City - Perspective

HoREA recommends that in 2022, more mechanisms and policies are needed to monitor the real estate market; at the same time encouraging the development of social housing, affordable housing (with prices suitable to the income of the majority of people) in order to balance the market and ensure social security for housing.

Forecasting the real estate market in 2022, HoREA believes that there is a strong recovery and growth trend in all market segments, but it is not possible to immediately improve the supply of housing products. This type of housing is affordable because it takes time to continue to develop additional mechanisms and policies, and due to the impact of "latency" legal regulations and the specificity of the investment process. There is also a "latency" in building real estate projects for housing products (about 18-24 months), so overall the market still lacks the supply of affordable housing.


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