A high-end apartment complex in Thủ Thiêm, HCM City. Việt Nam is now among the region’s least affordable housing markets, analysts say. — VNS Photo Bồ Xuân Hiệp

Bồ Xuân Hiệp

HCM CITY — When Nguyễn Quốc Thịnh, 42, purchased a 70-square-metre apartment in HCM City’s Thủ Đức area for VNĐ4.3 billion (US$169,000) in late 2024, he believed he had landed a great deal. The agent assured him it was the “last unit at a good price”, especially since similar apartments were being listed for up to VNĐ4.7 billion.

But soon after moving in and joining the residents’ chat group, Thịnh realised the truth: similar units were being resold for significantly less, some even under VNĐ4 billion with quick payment terms.

“That’s when I realised I had overpaid,” he said. “The price was inflated, and now I can’t even sell it for what I paid.”

Thịnh’s case is far from unique. In Việt Nam’s largest economic hub, hype-driven pricing in the secondary apartment market, that is, the resale of previously owned units, is distorting real estate values and putting buyers at serious financial risk.

Việt Nam is now considered one of the least affordable housing markets relative to average personal income, according to analysts.

Despite rapid urban development, residential prices in major cities like HCM City and Hà Nội have consistently outpaced wage growth.

This has made homeownership increasingly unattainable, particularly for young people and low- to middle-income earners.

“The gap between earnings and housing prices continues to grow,” said Lê Quốc Kiên, an independent housing analyst.

“We are witnessing a dangerous disconnect between perceived property value and the financial capacity of ordinary citizens.”

FOMO tactics

Market insiders say the sharp rise in secondary apartment prices is not purely the result of organic market demand. Rather, it is being driven by strategic marketing, speculative sentiment, and psychological manipulation.

One commonly used slogan among brokers is: “People are born every day, but land is not.” This plays on the fear of scarcity and urges buyers to act quickly or risk being left behind.

“It’s a psychological game,” said Nguyễn Thị Ngọc Bích, 50, a real estate investor with nearly two decades of experience.

Bích explained a typical four-step strategy used by sellers: establish a high “anchor” price, stage a few high-value transactions to create a reference point, offer slight discounts to create the illusion of a deal, and finally, activate Fear Of Missing Out (FOMO) by claiming that inventory is limited or prices will keep rising.

“In many cases, buyers aren’t paying for actual value,” she said.

“They’re paying for the illusion of value.”

According to CBRE Vietnam, the average resale price of apartments in HCM City rose 15 per cent in 2023, with eastern areas seeing increases of up to 18 per cent.

Market research firm Avison Young Vietnam estimates a 15 per cent annual increase in secondary prices over the past five years.

Data from Batdongsan.com.vn show that listing prices for apartments in several inner-city areas have risen from 17 to 31 per cent year-on-year, and as much as 52 per cent higher than 2023.

However, these are listing prices, not actual sale prices.

“These numbers reflect what sellers hope to receive — not what buyers are willing to pay,” said Đinh Minh Tuấn, southern regional director at Batdongsan.

“Real transactions often close 5–10 per cent lower, and in a slow market, discounts must go even deeper to close deals.”

The spike in prices is also being driven by a supply shortage, especially in the mid-range segment. Legal hurdles, prolonged approval processes, and credit restrictions have delayed the launch of new projects in the city.

“Anyone looking for an apartment under VNĐ3 billion is basically priced out,” said Lê Quốc Kiên, an independent housing analyst.

“There’s hardly any new supply, and sellers of older units are pricing based on the latest high-end launches, even if their buildings offer fewer amenities and are of lower quality.”

He noted that many properties now marketed as “luxury” or “high-end” were considered mid-tier just a few years ago.

“The buildings haven’t changed — only the labels and the prices have.”

Growing risks

Experts are warning of growing risks, particularly for buyers depending on mortgages.

When an apartment is priced beyond its appraised value, banks may reject the loan or reduce the loan-to-value ratio, leaving the buyer to make up the difference out-of-pocket.

“In many cases, banks have refused to release full loan amounts because the appraisal is from 10 to15 per cent below the asking price,” said Nguyễn Văn Đính, vice chairman of the Vietnam Real Estate Association.

“This puts homebuyers in a precarious position, especially those taking on debt beyond their means.”

Đính said speculative pricing is distorting the housing markets in both HCM City and Hà Nội.

“When prices rise but liquidity falls, that’s a clear warning sign. It suggests manipulation, not market equilibrium.”

Recommendations

To avoid overpaying, experts recommend buyers do their own due diligence and look out for warning signs.

These include rental yields below 2 per cent annually (versus a healthy 3–5 per cent); properties resold multiple times within a short period; steep price hikes without major upgrades; clusters of listings or sudden media hype in a specific area, among others.

Buyers are also advised to check past sale records via land registries or notarised contracts, assess building quality and maintenance, and speak with residents to understand real rental potential and ownership experience.

Secondary apartments, long viewed as a safer, less speculative alternative to off-plan properties, are now among the most vulnerable to overpricing.

A high price tag does not equate to strong resale value. “For inexperienced buyers, inflated prices can quickly wipe out savings and derail long-term financial goals,” said Kiên.

“People must understand: hype is not the same as value.”

For Thịnh, the lesson has been costly and clear.

“If I had done more research, I would’ve made a different choice,” he said. “Next time, I’ll look beyond the brochure and ask what the apartment is actually worth.” — VNS