Specifically, Hanoi is striving to have an average income per capita of 150 million VND/person/year in 2023, in comparison to 2019, the average income growth rate is 6%/year. Meanwhile, the growth rate of apartment prices from 2019 to the first half of 2023 is 13%/year.

“ It is clear that the growth in per capita income in Hanoi is lower than the growth in apartment prices ,” said Ms. Do Thu Hang, Senior Director, Consulting and Research, Savills Hanoi.

According to Ms. Hang, this is an example to show that home ownership will take longer if this gap continues to widen. If these two numbers do not move closer together, it will make home ownership for people in general, those living in Hanoi and those from other provinces who want to own a house in Hanoi, take longer and be more difficult.

Not to mention low-rise housing products, when the price is high, buyers will also consider the reasonableness of the price as well as consider whether it is suitable for the real value of the product or not. From here, the buyer's decision making will be slower and longer.

Savills' 2023 first-half market report also shows that in the apartment market, new supply increased by 76% quarter-on-quarter and 125% year-on-year to 3,596 units. Of which, the primary market welcomed 20,412 units, up 5% quarter-on-quarter and 14% year-on-year.

In contrast, the villa and townhouse market had no new projects in the quarter, with all new supply coming from 126 units from existing projects, up 334% QoQ but down 14% YoY.

In the second quarter of 2023, the average primary selling price of apartments in the Hanoi market reached VND53 million/m2. This price has increased for 18 consecutive quarters and is 73% higher than in the first quarter of 2019.

The reason pointed out by Ms. Hang is due to the increase in land prices and construction costs.

In addition, the need to invest in improving the quality of products and surrounding infrastructure and utilities, and internal projects also lead to primary market prices, or prices of newly launched projects, always being higher than the general market level of apartments for sale.

Meanwhile, for villas and townhouses, prices in the second quarter of 2023 compared to previous quarters have been adjusted downwards for some villas or townhouses. Townhouses have not recorded any price reductions.

Ngoc Vy