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Written by Dustin Trung Nguyen, Head of IQI VietnamVietnam Real Estate Market OverviewHo Chi Minh City (HCMC) has announced a bold vision to create a US$7 billion international financial hub in District 1 and Thu Thiem Urban Area, with the initial nine-hectare phase centered in Thu Thiem. This strategic move includes regulatory infrastructure and talent development, signaling elevated residential interest in the Thu Duc area. However, it also adds speculation risk, as housing prices—already high—are rising fast. In Q1 2025, property prices in some regions soared 20-40% year-on-year, and Vietnam’s house price-to-income ratio now stands at 24.7–26, far exceeding the global affordability benchmark of 15.On the commercial side, Hanoi’s mid-tier serviced apartment rents climbed 14% in Q1 to US$25/sqm/month. Meanwhile, Vietnam’s legal stance on short-term rentals is under scrutiny. Though current law restricts Airbnb-style leases, legal gaps remain—no precise definitions of “short-term” exist, and many argue such bans infringe on homeowners’ rights as outlined in the Civil Code. Regulatory revisions are likely, with implications for both local landlords and the broader property leasing market.Click for more info!Download

Written by Dustin Trung Nguyen, Head of IQI VietnamVIETNAM REAL ESTATE MARKET OVERVIEWResidential SectorHousing Supply in Ho Chi Minh City Remains LimitedThe residential property supply in Ho Chi Minh City (HCMC) remained constrained in the early months of 2025, with only 350 condominium units and 58 ready-built townhouses and villas launched, according to CBRE Vietnam.All new launches came from subsequent phases of existing projects, although there have been notable improvements in resolving legal bottlenecks. Duong Thuy Dung, Executive Director of CBRE Vietnam, noted that certain projects—such as a condominium development in District 7—may soon be able to sign sales contracts. Meanwhile, long-delayed housing developments in Thu Duc City, handed over between 2016 and 2019, are expected to finally issue ownership certificates, helping to restore buyer confidence.Data from the municipal People's Committee indicates that approximately 38,000 apartments are expected to receive title deeds in 2025. Since late 2024, new sales activity has resumed in Thu Duc after a two-year halt due to regulatory challenges.Integrated urban township models on HCMC’s outskirts have gained traction, supported by accelerated investment in key infrastructure projects. Experts note that the western region of the city—home to several major developers—is witnessing strong preparations for new launches and robust reservation demand. One urban project near Tan Son Nhat Airport in Tan Phu District recorded over 1,000 reservations within just ten days of its launch.In neighboring Long An Province, investor interest is growing. A green urban township in Ben Luc, near Binh Chanh District, is currently accepting reservations, while a nearly 200-hectare urban area in Duc Hoa has recently broken ground and is expected to launch later this year.The residential market in western HCMC is projected to become increasingly vibrant in the coming quarters. In total, more than 8,600 condominium units and fewer than 1,000 ready built townhouses and villas are expected to launch throughout 2025, predominantly in the suburban zones.In the office segment, Thanh Pham, Associate Director of Research & Consulting Services at CBRE Vietnam, reported strong absorption of newly completed Grade A buildings, with over 4,000 square meters leased in Q1 2025.Commercial SectorHCMC Retail Space Fully Leased Despite High PricesRetail occupancy in Ho Chi Minh City remains near 100%, even as rental rates reach record highs and supply remains stagnant. As of November, most malls in District 1—such as Saigon Centre, Parkson Le Thanh Ton, Vincom, and Diamond Plaza—are nearly fully leased, with only limited availability on basement and upper levels.A leading F&B brand seeking to expand on Dong Khoi Street, one of the city’s most expensive retail corridors, has faced delays due to space shortages. Similarly, a coffee chain has had to revise its business strategy after being unable to secure appropriate space in central locations.“It is extremely difficult to find spacious retail areas in prime malls,” the company stated. “Most are fully occupied.”Property consultancy Avison Young Vietnam confirmed there was no new retail supply in District 1 in Q3, with existing malls at full capacity. Notably, 75% of the city’s 1.5 million square meters of retail space is located in suburban areas.The shortage of prime retail space, combined with strong demand from luxury brands, has pushed rents upward. District 1 retail rents stood at US$275–300 per square meter per month in Q3, according to Avison Young.David Jackson, CEO of Avison Young Vietnam, noted that high-end brands prefer shopping malls in central locations, making competition intense. Luxury labels like Longchamp, Lush, and Popmart have chosen District 1 for flagship stores, despite attractive offers from suburban developments.Office and Industrial Market TrendsCBRE Vietnam’s 2024 Asia-Pacific Office Occupier Survey revealed that competitive rental rates and high-quality service are key factors influencing tenant relocations. In Q1 2025, relocations accounted for 50% of tracked major lease transactions, with the information technology sector leading both in volume (25%) and leased area (31%).Meanwhile, the industrial land market in southern Vietnam maintained a stable 89% occupancy rate. The ready-built warehouse and factory segments saw continued growth, with Q1 occupancy rates reaching 72% and 89%, up 14 and 3 percentage points year-on-year, respectively.Click here now for more info!Download

This article contributed by Dustin Trung Nguyen, Head IQI VietnamResidential: HCMC apartment price climbs to new peak of nearly $4,700 per square meter. Apartment prices in Ho Chi Minh City rose to an unprecedented VND120 million (US$4,691) per square meter on average in the first quarter, marking a 47% increase year-on-year. But the record price was achieved because a majority of new launches in the last three months were in the high-end and luxury segments priced at above VND100 million (US$3,870) per square meter The eastern and central districts of HCMC, where the high-end projects are largely concentrated, continue to lead the charge in new supply, accounting for some 53% of over 2,390 units launched in the first quarter. The south and west, which still offer some mid-range projects (priced at around VND60 million per square meter), represent 19% and 15% of the supply.  Knight Frank’s data shows that the average apartment price in HCMC in the first quarter reached nearly VND92 million per square meter, a 12% rise from the same period last year, with transaction volumes dropping by 47% compared to late 2024. Cushman & Wakefield CEO Trang expected HCMC to add around 9,500 new apartments in the second quarter, predominantly in the high-end segment with an average selling price of VND120 million per square meter. If the prices continue to rise, demand is expected to gradually shift toward the city’s suburban areas and neighboring cities, where prices remain affordable.  Hanoi apartment price growth in the first quarter decelerated to the slowest pace in nearly two years as sellers lower their rates to attract buyers. Prices on the primary market – where developers sell directly to buyers – averaged VND75 million (US$2,915) per square meter in the first three months, a 3% growth from the last quarter of 2024, this was the slowest quarterly growth since the second quarter of 2023. The secondary market – where buyers sell to other buyers – also saw slower price growth at 3% to VND50 million. In most projects, prices were stagnant, except for those in prime areas where leasing potential was high.  Data from research firm Cushman & Wakefield echoed these findings, reporting declining demand for Hanoi’s apartment sector. The market recorded sales of over 4,300 units, a 53% drop from the previous three-month period. Absorption rates weakened as buyer confidence waned, with many prospective buyers adopting a cautious stance amid ongoing economic uncertainties. Most of the new units, 77%, were in the high-end and luxury segments, and few were affordable. Property listing platform Batdongsan has seen apartment prices in the capital going flat since the end of last year. Commercial:  Many shopping malls in Hanoi, most of them once thriving hubs of entertainment and retail, are now largely vacant and attract few customers. Meanwile, HCMC office rents at 5-year high driven by rising demand Premium office rents in HCMC reached a five-year high of US$67 per square meter on average last year after rising by 2.2% from 2023. Across all grades (affordable, mid-range and premium), the average rent rose by 1.6% to $36, according to property consultancy JLL Vietnam. Data from market researcher Knight Frank confirms the rising trend, showing prime office rents grew by 3% last year to $61.  Occupancy rates in new office buildings were 88-90%, it said. Another property consultancy, Savills, said the HCMC office market has seen a steady increase in rentals over the past decade.  Last year, across all grades, they increased by 2-3% but demand remained strong as indicated by occupancy rates of above 89%.  Trang Le, CEO of JLL Vietnam, said recovery in demand from both domestic and international businesses has been a key driver, allowing premium office landlords to confidently hike prices. Last year the vacancy rate dropped to just 6% at premium buildings and 12% across the market, she added.  Japanese companies have been active in securing office space, accounting for 19% of the more than 75 companies that signed new lease agreements in HCMC, JLL data shows. Vietnamese businesses were in second place, with South Korean and American firms close behind. The information technology and communications sector led the demand for office space (accounting for 30% of the total absorbed area), followed by the finance and banking, retail and pharmaceutical industries. Want deeper insights into global property trends? Download our comprehensive market value report to explore opportunities beyond VietnamDownload

Written by Dustin Trung Nguyen, Head of IQI VietnamVIETNAM REAL ESTATE MARKET OVERVIEWResidential MarketHo Chi Minh City (HCMC) has banned apartment owners from leasing their properties for short durations as part of efforts to curb unauthorized Airbnb-like services.Only licensed businesses offering tourism services will now be allowed to lease properties for short-term stays, although the authorities have not clearly defined what constitutes a "short" duration.With the rapid increase in apartment towers across Vietnam’s largest city, many owners have turned to short-term rentals, using platforms like Airbnb and social media to connect with customers. However, most of these rental incomes remain untaxed.The popularity of Airbnb-style rentals has led to conflicts between short-term tenants and long-term residents, who often complain about noise disturbances late at night and cleanliness issues.Rising Property Prices and Affordability ChallengesSoaring property prices have left many young people unable to rent or buy homes.According to property analyst Le Quoc Kien, young people whose parents own homes in Hanoi and HCMC often have no choice but to live with their families to save money. With average salaries ranging from VND 10-15 million, homeownership has become a distant dream.A recent Global Property Guide report ranked Hanoi as the 11th most expensive city in Asia for renting.The average rent for a two-bedroom unit in Hanoi has reached US$715, surpassing rental rates in Kuala Lumpur, Jakarta, and Mumbai.A Vietnam Association of Realtors (VARS) bulletin highlights that house prices continue to outpace income growth, making homeownership increasingly unaffordable.VARS estimates that to buy an average apartment in Hanoi, a household would need to earn VND 45-210 million per month, equivalent to 2.3 to 10 times the actual incomes of most people.Nguyen Van Dinh, chairman of VARS, attributes rising prices to a supply shortage, as developers continue to cater mainly to high-income buyers and speculators, leaving low- and middle-income buyers with limited options.A report by the Ministry of Construction stated that apartment prices in HCMC increased by 20-30% in 2024.Affordable housing, which was once priced under VND 30 million per square meter, now starts at VND 45 million.A small apartment in Thu Duc City is now priced at nearly VND 2.5 billion.Commercial MarketHanoi's Shophouses Struggle Amid E-Commerce BoomMany shophouses in downtown Hanoi have been left vacant as shop owners struggle to keep their businesses afloat due to the rise of e-commerce.Thu Phuong, a former shop owner in Hanoi, recently vacated her 70-square-meter fashion store in Cau Giay District, after closing two other outlets earlier this year.While revenues from her three stores used to be sufficient to cover rent, declining sales forced her to end her lease contracts. She is now shifting her business online and looking for a smaller store inside alleys to reduce costs.Declining Demand for Physical Retail Spaces|Hanoi’s once-bustling commercial streets are seeing an increasing number of vacant outlets, as landlords struggle to find tenants:Kim Ma Street, known for its fashion stores and restaurants, now has over 40 closed storefronts.Nguyen Thai Hoc Street is experiencing similar vacancy trends.The Changing Landscape of Retail InvestmentsDuc Huy, a property broker with five years of experience, noted that the number of available shophouses has risen by 15-20% compared to last year.A five-floor house on Kim Ma has remained vacant since August, despite rent prices being lowered by 10% compared to two years ago, now at VND 50 million (US$1,960) per month.Shifting Consumer Preferences & Market AdjustmentsIn previous years, landlords could demand high rents, and tenants were willing to pay. However, that is no longer the case.Nguyen Chi Thanh, vice chairman of the Vietnam Association of Realtors, stated that shophouses face major challenges, as consumers increasingly prefer shopping in malls or online.Many businesses are redirecting investments away from physical locations and focusing on online marketing, which attracts more customers with lower overhead costs.Some analysts also highlight that Hanoi’s shophouses often lack sufficient parking spaces, making them less convenient for customers compared to malls.Declining Profitability of Shophouse RentalsDinh Minh Tuan, business director at listing platform Batdongsan, observed that the profitability of shophouse rentals has been declining due to shifting consumer behavior and increasing online sales competition.FOR MORE UPDATE NEWSLATTER, CLICK HERE!