Hanoi and HCMC rank among Asia’s least affordable cities for homebuyers, surpassing Singapore in the gap between housing prices and average income, a report has shown.
The report by property consultancy CBRE analyzed the disparity between housing prices and per capita income in major Asian cities.
Hanoi’s average apartment price is US$2,600 per square meter, while the average annual income is $6,300, resulting in an income-to-housing price ratio of 2.4.
HCMC’s average apartment price is $2,800 per square, with an average annual income of $7,500, yielding a ratio of 2.7.
A higher ratio indicates
greater affordability, while a lower ratio suggests the opposite.
The two major cities in Vietnam rank only higher than Hong Kong, with a ratio of 1.7, and Seoul and Manila which have a ratio of 2.3.
“This shows that buying a home in Hanoi and HCMC is even more difficult than in Singapore,” CBRE said.
While Vietnam’s housing price is similar to that of other countries in Asia, average income is much lower, which explains the smaller ratios.
Kuala Lumpur’s average income, for example, quadruples that of Hanoi.
Other studies have pointed out the same challenge of purchasing housing in Vietnam.
A report by property listing platform Batdongsan ranks Hanoi and HCMC among the
least affordable housing markets in Southeast Asia.
A Hanoi resident would need 50 years of income to buy a house and 23 years to afford an apartment, it estimates.
By comparison, the International Monetary Fund considers housing affordable when it does not exceed 30 years of household income.
“In most developed countries, young professionals typically need 10 to 15 years to buy a home. But in Vietnam, it takes 23 to 25 years – nearly an entire working career,” according to Batdongsan.
Vietnam Association of Realtors (VARS) estimates that with current prices ranging from VND40–70 million (US$1,594-2,791) per square meter, a 60-square-meter apartment in Hanoi or Ho Chi Minh City costs between VND2.5–3.5 billion.
Source: Vnexpress
