The price of apartments in Hanoi is slowing down.

In Q1, the price increase of primary and secondary apartments in the capital reached its lowest point in nearly two years, yet it remains high.

In the Q1 market report, the real estate service firm CBRE stated that apartment prices in Hanoi are showing a slowdown in both the primary market (developer offerings) and the secondary market (resale).

After a period of rapid growth since the beginning of last year, the current selling price of primary apartments is approximately 75 million VND per square meter (excluding VAT and maintenance fees), showing a slight increase compared to the previous quarter. 'This is the lowest quarterly increase since Q2/2023,' CBRE noted. The high-priced inventory mainly comes from large-scale urban areas on the outskirts.

In the secondary market, the price increase in Q1 has also slowed down. The current transfer price of apartments is around 50 million VND per square meter, up slightly by 3% compared to the previous quarter. Most project prices have not fluctuated much, except for some projects located in prime areas in the downtown district, which have good rental potential.

This trend has also been noted by the research unit Cushman & Wakefield. The firm stated that demand for the apartment segment in Hanoi is showing signs of decline. The market saw over 4,300 apartments sold, a decrease of 53% quarter-on-quarter. Absorption rates have slowed somewhat due to reduced buyer sentiment, with most waiting given the ongoing economic difficulties.

However, new project prices remain high; Cushman & Wakefield reported that the premium and luxury segments account for more than 77% of the new supply, while the affordable apartment segment is very limited.

Hanoi real estate, October 2024. Picture: Giang Huy

Data from the Batdongsan channel shows that the apartment market in Hanoi began to stagnate in late 2024. Asking prices and transaction volumes at many projects are trending downward compared to the same period last year. The declines of 2-5% from the peak early last year are concentrated in projects such as Ha Do Park View, Trung Yen Plaza (Cau Giay), Masteri West Heights, FLC Garden City (Nam Tu Liem), CT4 Yen Nghia, and Mulberry Lane (Ha Dong)...

Ms. Nguyen Hoai An, Senior Director of CBRE Hanoi, noted that the slowdown in Hanoi's apartment prices is understandable after two years of skyrocketing increases of 35-40%. In previous quarters, housing prices could rise by approximately 8-9% monthly, but now the increase is around 3%. The reason is that many homeowners have started to adjust their selling prices after a period of hoping to sell at higher rates. If they do not reduce their prices, their assets will be challenging to liquidate because the overall sentiment among buyers is currently cautious.

She pointed out the phenomenon of some homeowners and brokers using the tactic of "cutting losses" when selling apartments to attract buyers. In reality, homeowners who purchased 2-3 years ago find it very difficult to incur losses or reduce prices below their purchase levels. "The advertised price reductions mainly reflect a reduction in expectations," Ms. An said.

However, genuine "loss-cutting" cases are occurring in several projects and newly developed areas that were once hot price zones, such as the West, East, and South. Mr. Pham Duc Toan, CEO of EZ Property, noted that most buyers of these projects are speculators looking to "flip" for profit. They initially invested about 15-20% but do not have sufficient capital to pay according to the progress, leading them to rush to transfer their properties.

Furthermore, the continuous influx of new apartment supplies is increasing the pressure to sell. CBRE forecasts that Hanoi may receive around 31,700 apartments this year, primarily in peripheral areas such as Dan Phuong, Long Bien, and Dong Anh...

"The new supply is no longer scarce, and the stabilization of buyer sentiment makes it difficult for apartments to attract strong investment flows like last year," Mr. Toan mentioned.

Ngoc Diem