Luxury housing exceeds affordable housing supply in Ho Chi Minh

CBRE Vietnam revealed that developers have been hesitant to invest in the latter because of low profit margins

In Ho Chi Minh, affordable apartments made up for only two percent of the housing supply, whilst luxury homes accounted for six percent, reported VnExpress International, citing a study from CBRE Vietnam.  

In their latest report, the city did not get any new affordable housing projects from March to December 2019, whereas the high end segment had two.  

“Although affordable apartments (under USD1,000 per square metre) are the segment with huge demand, there has not been enough supply for several quarters,” said Duong Thuy Dung, the senior director at CBRE Vietnam.  

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She said that this property segment doesn’t get high profit margins compared to the luxury segment, which is why developers are more keen to invest in the latter.

With the abrupt increase in home prices over the last five years, the median price for luxury apartments reached USD6,308 in the fourth quarter of 2019. The demand has also remained strong in this particular segment because all the luxury projects are in premier locations. 

Among those who have taken advantage of this strong demand are the winning developers of luxury condominiums at the 5th PropertyGuru Vietnam Property Awards 2019, such as SonKim Land Corporation and CapitaLand Thien Duc. 

If you know of any award-worthy real estate projects in Vietnam? Nominate them for the 6th Vietnam Property Awards by 26 June 2020. Simply visit asiapropertyawards.com/en/award/vietnam-property-awards for more details.