A representative of Truong Hai Real Estate Trading Floor said house prices in the old quarter had increased by 20-40 percent compared with the beginning of the year. 

The land on Dao Duy Tu street has seen the sharpest price increases. Earlier this year, a house there was priced at VND400 million per square meter, but now is VND600 million.

While the demand is on sharp rise, there is a shortage of properties for sale. Only those who have financial problems will sell houses in the most expensive area of the capital city.

Analysts said the houses in old quarter can bring income of tens of millions of dong a month in rent. One ad asks VND38.2 billion for a 2-storey house with the total area of 80 square meters on Hue street. 

While the demand is on sharp rise, there is a shortage of properties for sale. Only those who have financial problems will sell houses in the most expensive area of the capital city.

When reporters who acted as buyers asked to buy a house at the price of VND120 million per square meter as stipulated in the Hanoi authorities’ land price framework, the landlord said the price framework only ‘exists on paper’, and that the market price was much higher.

Le Anh Son, director of Phu Tai Real Estate Trading Floor, said three years ago, there were very few transactions at the price of VND1 billion per square meter. But the price level is common now. 

“In the past, only houses on Ly Thai To street near Hoan Kiem Lake could be valuable. But now, this price level is applied to other streets as well,” he said.

Also according to Son, people are now hunting for houses on Bao Khanh street, because they can build multi-storey houses there, while multi-storey buildings are prohibited on other streets.

Analysts said most investors buy houses in old quarters to build hotels or build offices and shops for lease, because this is the central area of Hanoi, a commercial hub with favorable conditions to do business. 

About the profitability of investments in old quarters, a real estate broker said one dong of investment can bring four dong of profit. 

“You can take back investment capital after a short time and expect long term profit. In general, the risk is low,” he said.

The broker said a 5-storey hotel with 30 rooms can bring tens of millions of dong in profit a month.

According to Gachvang, Hang Can street is the most expensive area with the average price of VND600 million per square meter. The price level has not changed in the last six months.

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