Market Trends of Vietnam Luxury Residential Real Estate Industry
Increasing Rich Population driving the Demand for Urban Branded Residences
In the latest New World Wealth 2021 Estate Trends report, high-net-worth people seek a private, secure place, lifestyle, community, facilities, and controlled traffic. These are the critical characteristics offered by urban branded residences. Therefore, the increase in the affluent population will boost the demand for urban branded residences in Vietnam.
In the future, with the rapid growth of the rich population in Vietnam and the need to improve the quality of life, the urban development of Ho Chi Minh City with the planning of the central area and the expansion to the East to Thu Duc City will contribute to the activation of branded products in the urban area, especially near Metro stations No. 1. These new urban branded residences will meet the strict requirements and standards from their wealthy residents.
According to The Wealth Report 2021, Vietnam will have 25,812 high-net-worth individuals (HNWI) with assets worth at least USD 1 million and 50 ultra-high-net-worth persons (UHNWI) with net worths of at least USD 30 million a piece by the year 2025. Asset values have soared due to falling interest rates and increased fiscal stimulus, increasing the global UHNWI population by 2.4% to over 520,000 over the past year. North America and Europe witnessed the process, but Asia experienced a true resurgence with its 12% increase.
Luxury Apartments in Ho Chi Minh City (HCMC) Showing a Record High Price Growth
The price of luxury apartments in prime HCMC locations like District 1 and the newly established Thu Duc City has hit VND 100-400 million (USD 4,300-17,400) per square meter. The initial price of a luxury apartment project in District 1’s Da Kao Ward was around USD 6,500-8,000 per square meter in 2018, the highest price for an apartment project. As of April 2021, the price has surged to USD 7,500-9,800 per square meter.
At a recently launched luxury apartment project on Ton Duc Thang Street, which runs alongside the Saigon River in District 1, apartments are priced at USD 18,000 per square meter, the highest Q1 rate in the country. Luxury apartment prices in the Saigon riverside area have soared by around 50% in two years. The highest-priced apartment project in the erstwhile Thu Duc District, located on Vo Van Nghia Street, has a price tag of USD 4,000 per square meter. The average price of luxury apartment projects in HCMC hit USD 6,898 per square meter in Q1, up 4.7% year-on-year, according to real estate consultancy CBRE Vietnam.
