Paradox of Vietnam's real estate market: Unreasonable product structure

A recent report by the Ho Chi Minh City Real Estate Association (HoREA) shows that the real estate market in the first half of 2025 has had positive changes with a growth rate of 9.1% compared to the end of 2024. Although there are still many difficulties, this recovery opens up new opportunities for the market.

"Upside down pyramid"

HoREA assessed that the level of difficulty in the market tends to decrease, partly thanks to mechanisms, policies and legal regulations being completed and put into practice.

2025 is considered a pivotal year, preparing for a period of stable and healthier real estate market development from the second half of 2026 onwards, when the delay from policy to project implementation process begins to take effect.

However, the report also pointed out a worrying paradox. That is, the current real estate product structure is seriously unbalanced. From 2024 to the first 6 months of 2025, almost all projects brought to the market are high-end housing.

"This development method is like an upside-down pyramid, where the "top" is huge while the "bottom" - affordable housing and social housing - is too small, not enough to meet the needs of the majority of people," emphasized Mr. Le Hoang Chau, Chairman of HoREA.

Specifically, in the first half of 2025, the country had 4 new commercial housing projects eligible to mobilize capital with 3,353 luxury apartments, with a total value of up to 10,239 billion VND. Meanwhile, social housing is still almost stagnant. The floor area of social housing construction is only 205,000 m², equivalent to 4,100 apartments, only completing about 11.7% compared to the 2021-2025 plan of 35,000 apartments and is still far from the target of 100,000 apartments by 2030.

Nghịch lý thị trường bất động sản Việt Nam: Cơ cấu sản phẩm bất hợp lý - Ảnh 1. — A real estate project has just had its legal problems resolved in Ho Chi Minh City.

143 projects still waiting to be resolved

While affordable housing is in short supply, housing prices continue to climb. Luxury apartment prices in 2024 have soared to VND90 million per square meter, meaning each apartment of this type costs an average of VND9.7 billion - far beyond the affordability of most middle-income earners.

In addition, there is another bottleneck: legal issues. From 2015 to 2023, up to 86 commercial housing projects in Ho Chi Minh City have been suspended or have not been able to be implemented, accounting for more than 62% of the total number of projects, with a scale of nearly 1,000 hectares and over 54,000 apartments. In total, the city currently has 220 projects with legal problems at different levels.

Although 77 projects have been resolved, 143 projects are still waiting to be resolved. This, according to HoREA, not only wastes land resources and reduces budget revenue, but also contributes to the scarcity of supply, making it difficult for housing prices to cool down in the short term.