The inventory of luxury apartments in Saigon as of Q4 2019 was 677 units, and that of Hanoi was zero, the lowest among ASEAN countries surveyed by real estate consultancy firm CBRE Vietnam.
The figure was over 31,000 unsold units in Thailand’s Bangkok, 8,400 in Singapore and 2,400 in Malaysia’s Kuala Lumpur.
“The price of luxury segment is catching up with those of developed markets in the region such as Bangkok; yet, the market is still appealing to investors due to limited supply,” a CBRE report says.
The average selling price for this segment was $6,308 per square meter in Q4 2019, up 10 percent year-on-year.
This made Vietnam one of the leading countries in terms of luxury apartment growth potential in the region, the report says.
Prices have risen as supply has dwindled. Last year, just two new projects were launched in the country, compared to five in 2018. This pushed the absorption rate of newly launched projects in this segment in recent quarters to above 70 percent.
Limited land banks in downtown areas of major cities associated with restrictive legal framework on issuing development certificate for projects will narrow new launches in the luxury segment in such areas over the next couple of years, the CBRE report says.
Prices will continue to increase at 10 percent annually due to lack of supply, it adds.
The luxury segment accounted for 6 percent of new apartment launches in Ho Chi Minh City last year, compared to 2 percent in the affordable segment, it notes.