Ministry of Construction: Apartment prices increased nearly 40% after 5 years

The above information was shared by Mr. Hoang Hai, Director of the Department of Housing and Real Estate Market Management, Ministry of Construction, at the first quarter press conference on the morning of April 26.

According to data from the Ministry of Construction, new projects and transfers have escalated recently, increasing by 3.3-4.2% compared to the end of 2023. For example, Vinhomes Nguyen Chi Thanh apartment, Dong Da district increased by 4 .2% to more than 72 million VND per m2. Eco Lake View apartment in Hoang Mai is listed at over 42 million VND per square meter, an increase of 4%.

The average price of apartments in the Capital has been set at 50-70 million VND per m2, an increase of 38% after 5 years, or an average of 7.6% per year. In addition to projects that have been used for 5-10 years, old high-rise dormitories are also priced quite high.

Leaders of the Housing Management Department admitted that some projects have had their prices pushed up in recent times, partly because the gap between supply and demand has lasted for many years. In the past three months, the North had 3 completed housing projects in Hung Yen, while Hanoi did not have any additional apartment projects.

“The situation of price inflation only occurs in some projects, especially through online sales, there are almost no transactions,” Mr. Hoang Hai commented after the Ministry of Construction inspected a number of projects. unusual price increase. However, when asked for more details about almost non-existent transactions in projects whose prices were pushed up, the representative of the Ministry of Construction did not provide more specific data.

Mr. Hai also said that there is no data on the results of verifying price gouging because “the Ministry has not received a report from the city”.

According to Decree 52, the Ministry of Construction is assigned by the Government to manage the real estate market. In particular, the price indexes are assigned to the Department of Housing and Real Estate Market Management to be managed and announced by the Ministry. When the market becomes hot in terms of selling prices for each segment, this agency of the Ministry will work with localities to implement regulatory solutions.

Besides the lack of supply, representatives of the Ministry of Construction said that apartment prices are being manipulated because the real estate product structure is not reasonable. The segment for high-income people accounts for the majority while affordable housing, housing for workers, and low income is very few. However, Mr. Hai said this situation will improve when the amended laws take effect soon, helping to remove bottlenecks in project development.

Prices have increased and there have been few transactions as assessed by the Ministry of Construction, but in reality, analysts believe that this apartment complex is unlikely to cool down in the short term. Because, in the immediate future, the Hanoi market has not yet resolved the supply “blockage” situation. Mr. Pham Duc Toan, CEO of EZProperty, said that the implementation of social housing projects – hoping to reduce apartment space – has been very slow so far. Since last year, the city has had only one social housing project with nearly 280 units opened for sale.

In addition to the apartment segment, according to the Ministry of Construction, the demand for individual houses and land plots has increased compared to the previous quarter. Accordingly, the number of individual housing and land transactions in Hanoi increased by 5-15% compared to the end of 2023, with selling prices fluctuating between 80 – 220 million VND per m2. In Ho Chi Minh City, about 90-250 million VND per m2.

The number of real estate transactions nationwide tended to increase in the first quarter, with more than 133,500 successful transactions (including apartments, individual houses and land). In which housing increased by about 30%, land increased by 20% compared to the end of 2023.

Ngoc Diem