Hanoi apartment market cools after prolonged price surge

Across the capital, apartment owners are offering substantial discounts on units of different sizes.

T.M.V., an investor in western Hanoi, said he had recently lowered the price of his 85-square-meter apartment at the VOV Me Tri apartment building from VND6.5 billion ($247,140) to around VND5 billion ($190,107), more than VND1 billion below its price at the beginning of 2026.

Despite the reduction, he has yet to find a buyer.

During the second half of 2025, when Hanoi's apartment prices peaked, units in the area were selling for around VND100 million ($3,802) per square meter.

Similarly, D.T.M. put up for sale a fully furnished 71-square-meter, two-bedroom apartment at 151 Nguyen Duc Canh in the Hoang Mai area at VND5.3 billion ($201,510) last month, but he has yet to secure a buyer.

In the Ha Dong area, H.N., owner of a 106-square-meter apartment, has also been trying to sell a fully furnished unit with a long-term ownership certificate for around VND6.5 billion ($247,140).

Although the property has been advertised on multiple real estate platforms and through brokerage firms since early April, no buyer has finalized a deal.

Price-cut listings are becoming increasingly common across Hanoi.

An investor in the Khai Son apartment complex in the Long Bien area has reduced the price of a 101-square-meter, three-bedroom apartment overlooking a park by more than VND1 billion compared with its value two years ago.

The property has remained unsold despite being listed since the beginning of the year.

Higher borrowing costs, expanding supply weigh on market

Nguyen Van Dinh, vice-chairman of the Vietnam National Real Estate Association, told Tuoi Tre (Youth) Online that the apartment market has faced tightening liquidity since the start of the year.

He noted that investors had previously relied heavily on inexpensive financing and financial leverage.

However, rising interest rates have made borrowing significantly more expensive, while buyers have become increasingly selective.

Also, developers have launched more projects as large-scale urban developments continue to expand.

Although housing demand remains relatively stable, buyers now have a wider range of options and are prioritizing higher-quality projects with more reasonable prices, resulting in slower transaction activity.

Investors carrying substantial debt are under mounting financial pressure and are forced to reduce prices to liquidate their holdings, Dinh said.

Meanwhile, real estate developers launching new projects have also responded to changing market conditions by lowering primary sale prices and offering more attractive sales incentives to stimulate demand.

Nguyen Quoc Khanh, chairman of DTJ Distribution and Investment JSC, attributed the reduction in apartment prices in the city to the government’s policy to encourage the development of rental housing.

Besides, speculative activity had previously driven apartment prices well beyond the affordability of most homebuyers.

Many secondary investors purchased units in anticipation of further appreciation but are now being compelled by elevated borrowing costs to sell at a loss in order to recover capital.

Dinh Minh Tuan, the southern regional director of Batdongsan.com.vn, said the growing number of newly launched apartment projects is giving buyers more choices.

Major cities such as Hanoi and Ho Chi Minh City evolve from single-center to multi-center urban areas, forcing secondary investors holding properties in older central locations to adjust prices to remain competitive.

Tuan also said the market is moving away from pricing driven by expectations toward valuations based on underlying market fundamentals.

As a result, distressed sales are likely to become more common in the near term.

He believed the trend will largely depend on interest rate movements.

Tuan expected loss-making apartment sales to continue for at least the next six to twelve months before the market gradually stabilizes.

He added that the continued expansion of housing supply should help establish a more sustainable and realistic pricing benchmark for Hanoi's apartment market.