Saigon housing prices go up and up

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Saigon housing prices go up and up

An aerial photo of Ho Chi Minh City’s real estate. Photo by Shutterstock/Binh Ho.

Average prices for apartment and terraced house segments in HCMC saw double digit growth in the third quarter.

Apartment prices in HCMC averaged $2,067 per square meter in the third quarter of this year, up 23.8 percent year-on-year, according to a market report released Thursday by real estate firm JLL Vietnam.

Prices of high-end apartments reached a new historical high at $5,320 per square meter, up 64.9 percent year-on-year, driven by high prices set on new launches as supply remained generally limited due to lengthy sale approval procedures with local authorities, the report said.

For ready-built property (RBP) including villas and terraced houses, average prices on the primary market reached $4,689 per square meter in the third quarter, up 20.2 percent year-on-year, while prices in the low and mid end segments rose 16 percent.

Demand was particularly strong in the terraced house segment of units priced between $170,000–$250,000 per unit, which mainly came from owner-occupiers and capital gains investors.

New supply of RBP by the end of this year is expected to remain limited, reaching just over 2,000, half that of 2018, also because of slow procedures, while some demand will shift from investors in the high-end apartment segments, the report said.

According to JLL, these investors, the main demand source for high-end apartments, have already begun shifting their investment to RBPs to enjoy better capital gains, given that the cost to acquire high-end apartments have now reached a new high, making the investment less attractive.

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