The Ministry of Construction (MOC) reported that in the past nine months, primary apartment prices in Hanoi and HCMC have remained high, with a firm upward trend compared to the same period last year.

In Hanoi, the average primary price reached VND70-80 million per sqm, up 5.6 percent compared to Q1/2025 and 33 percent higher than in 2024. Some luxury projects recorded prices of VND150-300 million per sqm.

Many apartment buildings in Hanoi are priced sky-high despite lacking living space and even showing signs of deterioration.

At A6 Nam Trung Yen resettlement complex, consisting of four 11-story buildings with 440 units, is located on a “prime land” spot in Trung Hoa ward, listings have reached up to VND85 million per sqm, meaning a 50 sqm unit could cost around VND4.1 billion.

In HCMC, the average primary price was around VND75 million per sqm, which is stable compared to early 2025 but up 36 percent year-on-year. Certain high-end developments are priced from VND150 million per sqm and above.

Pham Duc Toan, general director of EZ Property JSC, said many factors drive high house prices. To develop a housing project, businesses must cover numerous costs, from planning, bidding, site clearance, infrastructure construction, and land use fees to meeting sales eligibility.

"Complicated legal procedures and rising land use fees, especially when some localities apply market rates, have inflated costs, forcing businesses to sell at higher prices," Toan said.

However, business leaders hope that the National Assembly’s Resolution 201 on piloting special mechanisms for social housing development, Resolution 171 on piloting commercial housing projects via land-use rights agreements, and upcoming Land Law amendments will positively unlock the real estate market.

According to Toan, to reduce house prices, it is necessary to boost supply, diversify products and prices, and streamline laws for faster project rollout. Importantly, strong policies are needed for social housing and factory worker accommodations.

Afamily.vn highlighted supply shortages as a key driver, with Hanoi's new projects limited and demand from young families high, pushing primary and secondary prices up. Tuoi Tre noted input costs like land, materials, labor, and borrowing rates are rising, making reductions tough in 2025.

When will prices begin to fall?

Tran Khanh Quang, a real estate expert, citing several reasons behind the real estate price escalation, emphasizing the short supply. The market is misaligned, with many products targeting investors rather than real homebuyers.

Land use fees remain a burning issue, which also makes it harder for individual investors to subdivide plots and build homes, reducing the availability of affordable housing.

To fix this, Quang said, the core solution is to increase housing supply and simplify construction permit procedures. For stalled projects, ministries and agencies need to collaborate to find final resolutions.

He recommended the government strongly develop social and affordable housing while easing policies for businesses to enter the market. With abundant supply, prices will naturally drop.

Previously, some experts suggested taxing properties as a solution to prevent speculation, which was believed to help bring prices down.

Regarding property taxes, Quang noted that in a low-supply, high-demand context, taxes would burden end consumers, further inflating prices. Thus, it is not the right time for this.

At a recent forum, Dr. Can Van Luc, BIDV's chief economist and Prime Minister's Policy Advisory Council member, suggested boosting housing supply to cut prices. Establishing the National Housing Fund is key to increasing affordable units.

Legal bottlenecks must be resolved: nearly 3,000 stalled projects worth about VND6 trillion are awaiting fixes, which could drive economic growth and cool prices.

Luc urged strict penalties on developers and brokers who deliberately inflate prices.

He supports the idea of taxing properties to prevent speculation. International practice shows three types of taxes for Vietnam to consider: transaction tax (based on revenue or profit), tax on second homes, and inheritance tax. However, applying these measures requires a clear roadmap and a unified, transparent data system, possibly needing another 1-2 years to prepare.

Hong Khanh