Investors from Northern Vietnam are increasingly turning their attention to the Southern real estate market, particularly Ho Chi Minh City and neighboring provinces, as the first quarter of 2025 looms. This trend marks a significant shift prompted by stagnation and decreasing rental yields observed in the North, leading to the pursuit of more lucrative opportunities to the South.
From 2020 to 2023, the real estate market in Northern cities like Hanoi, Bac Ninh, Hai Phong, and Quang Ninh experienced substantial price increases, with certain developments, including Vinhomes Ocean Park and Ciputra, making headlines for their rapid appreciation. Yet, by late 2024, this upward trend hit a wall; prices began to stall or even decline slightly due to oversupply and weak liquidity levels.
The struggle grew even more apparent as large-scale projects, particularly those positioned to the West and East of Hanoi, faced challenges with sales. Nervous investors hesitated, deterred by persistently high prices and complex legal concerns. These factors contributed to the perception among Northern investors—once attracted by potential gains—that the local market was no longer fertile ground for significant returns.
Particularly concerning was the decline of rental profitability. With rental rates increasing sluggishly compared to the steep rise of property prices, yields dwindled, making investment less appealing. The lack of reasonably priced projects and pressure from rising borrowing costs prompted many investors to seek alternatives, eyeing the Southern market with renewed interest.
Southern Vietnam is becoming the new hotspot for Northern investors, thanks to its remarkable growth prospects and the beginnings of recovery following the substantial economic impacts of prior years. The outlook for 2025 seems bright, as opportunities multiply across the region.
Remarkable developments are on the rise, such as Vinhomes Grand Park located near the center of Ho Chi Minh City, Gateway Thang Long, and VSIP Binh Duong, unfurling on extensive lands and promising nearly tens of thousands of apartments alongside various housing solutions. These projects not only cater to housing needs but also attract investors due to the potential for long-term rental returns and price appreciation.
The Southern region remains particularly attractive as many properties still possess considerable room for price growth, especially around Ho Chi Minh City and its outskirts, including Bình Chánh, Nhà Bè, and Hóc Môn, along with adjacent provinces like Long An and Đồng Nai. The rise of industrial zones, for example, VSIP II in Bình Dương, has attracted large numbers of migrant workers, necessitating more housing options.
According to market data, interest levels are reflecting this shift—queries for real estate options within Ho Chi Minh City by Hanoi investors increased by 7% from the previous quarter alone. Concurrently, there was a notable 12% drop in the number of individuals from the Southern city buying property up North. This trend reveals not only the dynamics of market interest but also highlights the growing perception of profitability within the Southern sector as housing costs remain lower than those found within Hanoi.
Surveys indicate 66% of real estate investors from Hanoi have shown deep interest or are actively considering moves toward Southern investments. These figures eloquently speak to the changing tide and reaffirm the sentiments of Northern investors seeing favorable returns tied to Southern real estate.
The dynamic interplay between modern infrastructure improvements and solid regional economic growth is turning Southern Vietnam’s real estate market increasingly attractive. A balanced combination of infrastructure development, rising economic zones, and appealing investment projects render the South the new land of opportunity for Northern investors. With the insights from Batdongsan and others, the possibilities seem broad and supportive of favorable outcomes moving forward.
Consequently, the strong wave of investment from Northern investors to the South is creating significant movement and reshaping financial strategies as they flock to Ho Chi Minh City and its adjoining provinces. Following years of price surges, Northern markets no longer appear as the 'fertile ground' they once were, propelling investors to explore opportunities where the growth potential remains high.
Real estate stakeholders are observing this trend with anticipation, as the Southern region opens its doors to investors searching for rewarded returns, even amid the changing economic visions for 2025. Time will tell how this vast migration of capital interacts with the Southern market's existing frameworks and what future developments may yield, but for now, the winds of change strongly favor the growing interest and investments flowing South.