The price of apartments in HCM City is expected to increase annually by 5-10 percent for the next three years, according to a report by Jones Lang LaSalle Việt Nam (JLL Việt Nam), a foreign commercial real estate and property services provider.
|The price of apartments in HCM City is expected to increase annually by 5-10 per cent for the next three years, according to a report by Jones Lang LaSalle Việt Nam (JLL Việt Nam), a foreign commercial real estate and property services provider. (Photo: vietstock.vn)|
JLL Việt Nam predicted overall apartment prices to rise annually by 5-7 percent in the next three years, supported by strong absorption and affordability levels. Mid-tier and affordable apartment prices could rise by up to 10 percent each year.
JLL Việt Nam believed that HCM City apartments were still affordable compared to income levels. Based on the top quintile household monthly income of $1,337, private apartments in the affordable and mid-end range would cost about 3.9 to 6.6 years of income, assuming an apartment size of 75 sq.m. The entry-level apartment price to income ratio of 3.9 years was 30 per cent lower than the average of 5.7 years in other Southeast Asian cities.
Even if prices rose 30 percent over the next three years, it was likely that the home price to income ratio would be stable given that incomes have been rising at 10 per cent annually in the last few years. In the last five years, home prices in HCM City declined amid income growth, bringing the home price to income ratio down from 7.6 years in 2010 to 3.9 years in 2015.
According to the Việt Nam Real Estate Association’s latest report on the local property market, prices of premium and mid-end apartments increased in July on the HCM City market.
Meanwhile, apartment prices also rose in Hà Nội, especially projects near the centre of city or important infrastructure constructions that are being built.
In July, land and houses continued be attractive segments on the domestic market. Demand on those property products increased, making selling prices for them rise by 4-12 percent depending on the location and area, the association said.
The market has seen many products offered by developers of projects like Cát Tường Đức Hòa and Phú Đông Him Lam in HCM City; Phú Lương urban area and Nam An Khánh in Hà Nội; and Mỹ Phước 4 urban area in Bình Dương Province.
The prices of those products rose by 20-40 per cent against the same period of last year, especially projects near the metro system in HCM City, and the Cát Linh–Hà Đông elevated railway in Hà Nội. The selling price of some projects having nearly-completed infrastructure and full conveniences could increase by 45-50 percent.