The real estate market in Hanoi is experiencing a notable shift, as the latest report from CBRE indicates that apartment prices in the first quarter of 2025 have only risen by 3%. This is a significant slowdown compared to previous trends, reflecting a broader stabilization in the housing market.
According to the Hanoi real estate market overview report released by CBRE on April 9, 2025, the new supply of apartments for sale reached nearly 3,920 units from seven projects, primarily located in suburban districts like Gia Lam, Dong Anh, Thanh Tri, and Thach That. While this supply is relatively modest compared to the average of 8,000 to 9,000 units sold in the previous three quarters, it marks a nearly 70% increase from the same period last year. Notably, this is the largest supply of apartments opened for sale in the first quarter in Hanoi in the last four years, since 2022.
The report also highlighted a diversification in the supply structure, with mid-range, high-end, and luxury segments represented. However, there remains a significant lack of new offerings in the affordable segment, which has been largely absent since 2022.
In terms of market liquidity, CBRE reported that the first quarter of 2025 maintained a stable state, with nearly 3,950 apartments sold. This figure represents a decrease of 63% compared to the previous quarter but shows a remarkable 72% increase year-on-year. The decline in sales from the previous quarter has been attributed to seasonal factors, including the Tet holiday, and the market's need to absorb the large number of apartments that have been opened for sale in recent quarters.
On the pricing front, CBRE noted that the strong upward trend in apartment prices in Hanoi has begun to slow. In the primary market, the average selling price reached approximately 75 million VND per square meter (excluding VAT, maintenance fees, and discounts). Although this price is 34% higher than the same period in 2024, it is only 3% higher than the previous quarter, marking the lowest quarterly increase since the second quarter of 2023.
Similarly, the secondary market has also seen a slowdown in price growth. By the end of the first quarter of 2025, the average selling price of secondary apartments in Hanoi was around 50 million VND per square meter (excluding VAT and maintenance fees). This represents a nearly 20% increase compared to the same period in 2024, but the quarterly growth has also slowed to just 3%, the lowest since the third quarter of 2023.
"Projects in prime locations, near existing residential areas and with good rental potential, especially in areas like Nam Tu Liem, Hai Ba Trung, Long Bien, and Gia Lam, have only seen slight increases of 2% to 3% quarterly. Meanwhile, prices for other projects have not changed significantly compared to the previous quarter," said Nguyen Hoai An, Director of CBRE Hanoi.
Looking ahead, CBRE forecasts that the Hanoi apartment market will see approximately 31,700 new apartments launched in the upcoming quarters of 2025. The purchasing power is expected to remain stable amid the introduction of large-scale new supply. Additionally, the primary selling price of apartments is projected to increase slightly by about 8% by the end of 2025.
In the segment of houses attached to land, CBRE reported that the new supply for sale in the first quarter of 2025 was relatively stable, with over 1,500 units launched, primarily from a major urban project in Dan Phuong. Although this supply has decreased by 46% compared to the previous quarter, it represents the highest supply of houses in the first quarter to date.
The absorption rate for houses attached to land in Hanoi remained stable, surpassing the new supply launched during the quarter. The total number of units sold reached over 1,800, concentrated in large urban projects in Dong Anh, Dan Phuong, and Van Giang (in Hung Yen province bordering Hanoi), which have substantial sales inventories.
Regarding pricing, the average primary selling price for land-attached houses in the first quarter of 2025 increased slightly compared to the previous quarter, reaching 226 million VND per square meter (including construction costs and excluding VAT), reflecting a 3% quarterly increase and a 17% increase year-on-year.
Looking forward, CBRE anticipates that Hanoi will welcome around 6,700 low-rise houses for sale in 2025, with prices expected to rise slightly by 8% by the end of the year.
Meanwhile, the Vietnam Association of Realtors (Vars) has released statistics indicating that apartment prices in major cities like Hanoi, Ho Chi Minh City, and Da Nang have seen remarkable increases over the past five years, with growth rates of 72.4%, 49.9%, and 34.3%, respectively. However, the average income of residents has only increased by about 6-10% annually, creating a significant gap between income growth and housing prices.
This disparity has made it increasingly difficult for young workers to purchase homes, forcing many to rent instead. The report highlighted that two-bedroom apartments priced under 3 billion VND have nearly 'disappeared,' making it challenging for young people to secure financing, even when they have about 30% of the apartment's value available for a down payment.
Many young individuals are reluctant to take on long-term loans, fearing the unpredictable nature of floating interest rates. Instead, they are opting for rental arrangements, which allow for greater mobility without the burden of fixed assets. Interestingly, even those with higher incomes and multiple properties are choosing to rent luxury serviced apartments, often priced at thousands of USD per month, to enjoy modern amenities.
Despite the growing demand for rental housing, the market remains limited in Vietnam, primarily due to individual ownership and management of rental properties, without the involvement of professional developers. In contrast, developed countries have popularized the 'build-to-rent' model, offering renters more choices and better services.
Moreover, the lack of tenant protection policies in Vietnam poses risks for renters, as most contracts are short-term (6-12 months) and lack stability in price increases. A two-bedroom apartment in central Ho Chi Minh City can cost between 12-20 million VND per month, which can consume 30-50% of many workers' income, forcing them to cut back on other expenses.
To mitigate financial pressures, Vars emphasizes that rental costs should not exceed 30% of one's income. Furthermore, they recommend prioritizing convenient locations for work and daily life, selecting reputable landlords, and ensuring clear contracts regarding rental terms and prices.
The trend of renting over buying is expected to continue growing, especially as innovative rental models, such as 'Rent-to-Own' and shared ownership, gain traction in Vietnam. The Chairman of Vars suggests that for renting to become a viable option, the rental market must be more professionally developed, supported by financial policies that protect tenants and encourage long-term contracts.
