Apartments and residential land lead Hanoi real estate market recovery in 2024

Many positive signals for the real estate market

According to the report of the Vietnam Real Estate Association, by the end of 2023, Vietnam's GDP increased by 5.05% in the context of many difficulties in the world economy; disbursement of public investment capital in 2023 continues to be the driving force for economic growth when it is expected to reach 95% of the plan, higher than the level of 2022; FDI capital reached 23.18 billion USD, the highest in the past 5 years, of which the real estate business ranked 2nd with a total investment capital of more than 2.87 billion USD, accounting for nearly 10% of the total registered investment capital... It is expected that the economy in 2024 will grow higher than 2023, reaching approximately 5.5 - 6%, maintaining its position among the countries with the highest GDP growth in the region.

Notably, the official approval of 3 sets of laws: the Law on Real Estate Business, the Law on Housing and the revised Land Law in late 2023 and early 2024, and officially taking effect from 2025, creates the premise for sustainable and long-term development of the real estate market from this year. With many strict regulations, enhancing transparency, these 3 laws promote the screening of weak businesses, creating momentum for the development of businesses that invest methodically and comply with the law.

On the other hand, savings and lending interest rates have decreased simultaneously until the end of 2023 and the beginning of 2024, creating favorable conditions for home loans and shifting savings flows to other channels.

In terms of infrastructure directly related to the demand of the Hanoi real estate market, according to One Mount, by the end of the fourth quarter of 2023, the construction progress of Ring Road 4 - Capital Region has reached about 7%, disbursement has reached 73% compared to the annual plan, expected to be completed in 2026; Ring Road 3.5 phase 1 from Thang Long Avenue to Hau Ai Bridge has been completed by the end of 2023 and the Hanoi Department of Transport has proposed that the City People's Committee prioritize research to upgrade Ring Road 2. Regarding bridges, at the end of December 2023, Me So and Hong Ha bridges across the Red River and Hoai Thuong bridge across the Duong River (part of the Ring Road 4 project) are expected to start construction on October 10, 2024. Regarding the Metro progress, by early 2024, the elevated section of the Nhon - Hanoi Railway Station urban railway was 99.6% completed, and the elevated section is expected to be operational on April 30, 2024.

All of the above factors have been positively impacting the Hanoi real estate market, creating opportunities to increase supply and strengthen investors' confidence to return to recover the market.

Forecasting market leading segments

The future supply of apartments and residential land in Hanoi in 2024 will be created in large quantities and will account for the majority of the market from the West and East of the city.

Through research, in the planning of Hanoi to 2030, with a vision to 2050, the Western area including 4 districts of Hoai Duc, Thach That, Quoc Oai, Chuong My is proposed to be planned to build a "Smart City", with 36 ministries, departments and branches to be relocated to the West of Tay Ho and Me Tri areas; the US Embassy headquarters will be built on the "golden" land on Pham Van Bach Street and the Le Quang Dao extended street project will have its starting point intersecting with Thang Long Boulevard...

This area owns the majority of office supply in Hanoi, the current infrastructure is constantly expanding and the city is having many orientations to develop the West into a new focal point of the city in general and the Hanoi real estate market in particular. In particular, the supply of apartment products in the West in 2024 is forecast to recover impressively, due to the high demand for housing when many future agencies of the city will be moved here.

Meanwhile, in the East, Hanoi's planning until 2030 with a vision to 2050 will play a central role, with Gia Lam district becoming a district in 2024; planned to develop transport infrastructure with projects such as Ring Road 4, Ring Road 3.5, National Highway 5A, 5B and developing 8 Metro railway lines. Accordingly, the East is positioned to become the center of Hanoi, leading to a significant increase in housing demand. Especially the construction of Gia Lam district into a district, with well-completed infrastructure, will be a positive signal to help the real estate market in the East develop sustainably. It is forecasted that in 2024, the supply will witness the apartment segment leading the real estate market share here.

According to statistics from the Vietnam Real Estate Brokers Association, the number of apartment and residential land transactions in the Hanoi real estate market in late 2023 and early 2024 was bustling in the two areas above, thanks to high stability, attractive price levels, and many business advantages. In particular, projects of large investors such as Vinhomes account for a large proportion. Metropolitan areas with large secondary supply in the market such as Vinhomes Ocean Park, Vinhomes Smart City, Vinhomes Times City... are the projects with the largest number of transfer transactions.

Real estate experts believe that with the forecast of Vietnam's economy growing by 5.5 - 6% in 2024, the apartment and residential land market in Hanoi is expected to record an additional supply of 17,000 new apartments, mainly from the West and East of the city.