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Tony Milton MRICS

BSc (Hons) Est Man

Low Income Housing
Monday, 16 March 2009




To help us analyse Vietnam's residential housing "market" let's first have a look at what is "affordable" by reference to international norms. Since I arrived in Vietnam over 10 years ago I have often thought that land here in Vietnam was the most expensive in the world. And thanks to's new research, I reckon I was proved right !............let's compare GDP to "average" unit price. In this case "based on 120sqm apartment in the city centre."


Since we know that Hanoi's GDP per capita is about USD$1,900 (though probably lower in view of the recent (dramatic) enlargement), and HCMC's is about USD$2,180 we are half way there (note - Vietnam's GDP is only about USD$1,024). But in reality there are so few "international standard" (ie not in danger of collapse, etc) apartments in the city centre (and they are not encouraged in HCMC!), what little stock there is, tends to be extremely expensive (which also helps to explain Phnom Penh's position in the league table). Furthermore, 120sqm units are bigger than "average" too. In any event, the numbers selected for Hanoi & HCMC of USD$1,750 & USD$3,000 are considered conservative and could quite justifiably be much higher.


Vietnam comes in as the 4th most "expensive" (CONGRATULATIONS!!!) behind India (Mumbai & New Delhi), Phnom Penh sandwiched inbetween, followed by Moscow. I don't think anybody would call any of these amongst the most beautiful in the world, and it is interesting to note that amongst the "cheapest" are Zurich, Copenhagen, Montreal and Auckland. Infact all the really nice places are down amongst the "cheapest." Perhaps that in part is why they are so "attractive" in the broadest sense of the word. It is also true that people in these places have great difficulty in investing off-shore ie getting their cash out of the country, so it is trapped in bubble metaphorically and physically. And there are no "rates" or property related taxes in Vietnam. And no workable bankruptsy law. Or effective personal income tax law / capital gains tax. Or landlord & tenant legislation / right of automatic renewal at market rents. And valuation is not taught.,..............




  • Asia is home to the largest and fastest growing countries in the world, both in terms of population and economic size. With its current size and anticipated rapid economic transformation its current size and anticipated rapid economic transformation and growth, the highest rural-to-urban shift is expected to occur in Asia.


  • As the population and urbanization increases, demand for housing for owner-occupancy and rental increases. Resources already devoted to housing become strained due to limited supply of land in cities. The inadequate supply of housing in the region can be seen in the high house-price-to income ratios and high share of slum dwellers in the urban population.


  • A decent 35 sqm. condominium unit in the city centre costs around 6 to 30 times the annual average income and there are serious affordability issues in Asian cities, especially in Seoul, Manila, Jakarta and Shanghai.



Condominium Affordability in ASIAN Countries


City     Income Per    Condominium         Condominium  Price to

           Capita ($)*      Price / sq.m ($)**     Price***            Income Ratio****

Kuala Lumpur 6,991         1,222                     42,770                6.1

Tokyo          45,425          8,000                    280,000                 6.2

Taipei          13,036          2,330                     81,550                  6.3

Hong Kong   27,670          5,998                    209,930                 7.6

Singapore    28,578           6,700                   234,500                 8.2

Bangkok       6,317           1,667                     58,345                   9.2

Seoul           10,305          3,300                    115,500                 11.2

Manila          2,217            1,300                     45,500                 20.5

Jakarta        1,861             1,250                     43,750                 23.5

Shanghai     2,474             2,200                     77,000                31.1

Vietnam       392

HCMC         1,900*****    1,400-1,800******   56,000   35*******


*        Data from “An East Renaissance: Ideas for Economic Asia Growth”, World Bank, 2006


**       Data from The Global Property Guide,


***     Assuming a 35 sq m condominium unit in city center


****    Condominium price divided by income per capita


*****   Ho Chi Minh City government statistics for 2006


****** Assuming condos in CBD (@$850 for central non-CBD)


*******Note – most condominiums in Vietnam in excess of 75sqm



Shanghai & China Focus


  • According to the Ministry of Construction the per capita urban living space has quadrupled since 1978, rising from just 6.5 square metres when China started its reform and opening drive to 26 square metres in 2005. In China's eastern regions, average per capita urban living space stood at 28 square metres in 2005 but in middle and western regions it was 23.9 and 25.2 square metres respectively. The most spacious place was East China's Zhejiang Province, where residents enjoy an average of 35 square metres each. At the same time the people of southwestern Guizhou Province have to make do with just 20 square metres. Following Zhejiang, Shanghai and Beijing ranked second and third with per capita living space of 33 and 32 square metres respectively. The area covered by urban parks has also risen 35%.


  • As China sped up its urbanization and modernization of rural regions, the majority of 1.3 billion Chinese have planned or started to buy or build more spacious homes.


  • Per capita living space in cities increased from 20 square metres in 2000 to 25 square metres last year. The figure is 40 in the United States, 38 in Germany and 30 in Japan and Singapore.


  • China's real estate market has experienced a major growth in some regions since 2002 with house prices increasing at around 15% annually on average.


  • Statistics from the National Development and Reform Commission indicated that real estate prices nationwide posted a year-on-year increase of 21%. The increase rate has slowed down to 6.5% during the last quarter in 2005 compared with 10.1% in the first half and 12.5% in the first quarter following on from the introduction of central government policies tightening land and loan supply in August 2004.


  • Sales of new apartments and villas plummeted to 1.67 million square metres in June 2006, down by 31% from May, according to a statement from the Senior Housing Research Centre of Centaline Shanghai, because of new government policies.


  • The central government made June 2006 the starting date for local governments to make 70% of their annual land supply available for the development of low-cost housing no larger than 90 square metres.


  • According to current income standards, the World Bank believes that the average household, worldwide, can earn enough money to buy an apartment in 5 years. But in China, that figure is 12 years for an average urban family. A report issued by the United Nations Human Settlements Program says that 1 out of every 6 people in the world lives in a slum, and the total number could double to 2 billion by 2030. The report also states that 40% of housing in urban areas can be classified as slums.





  • About a third of East Asia’s urban population lives in slums, a ratio that is higher than other middle-income countries in Latin America and the Middle East. In Southeast Asia, one out of every four urban residents lives in slums.


  • There are about 250 million slum dwellers in South and South East Asia, 178 million in China alone. Countries with serious slum problems include Indonesia (with 21 million slum dwellers), Philippines (20 million) and South Korea (14 million) [UN Habitat 2003]. These are the same countries that have serious housing affordability conditions.




  • 2004: August: HCMC plans to increase housing density from 10 sq.m per person to 14 by 2010, but to do this the city must build 5 million sq.m of new houses a year. That means the city needs to build 70 apartment blocks, or 8,400 individual apartments, according to the municipal department of construction.


  • 2005: January: About 21.8 million sq.m were built n 2004, raising floor space to 10.8 sq.m capital in urban areas.


  • 2005-April: Per capita housing space for HCMC residents rose from 9.7 sqm in 2000 to 13 sqm in 2005. City officials attributed the increase to the Construction Department, which has built 3 million sqm of floor space over the last 4 years. Also during the period, the city granted land use and house ownership certificates for 430,000 houses, with a 70 per cent acceptance rate. In addition, the city has simplified the process for construction licensing.


  • 2005-November: The supply demand imbalance : With rapid urbaniza­tion, HCMC will have to develop 5 million sq.m of housing a year in the next 5 years to increase total floor space to 100 million sq.m by 2010. If this comes true, each person's housing in the country's largest eco­nomic center will rise to 14 sq.m by 2010 from the current 10. The director of the Service of Construction, Nguyen Minh Dung, says most of the city's low and medium-in­come residents do not own a house.


  • 2006: August: HCMC government will mobilize resources to build an additional 32 million sq.m of housing until 2010 as main part of the city's just-issued housing development implementation plan for 2006 to 2010. This aims to raise the per capita housing area to 14 sq,m from the current 10.3 sq.m.


  • 2006-October: Tan Binh District now needs huge resources for develop­ment as its already-poor in­frastructure, especially housing, is not sufficient to keep up with the fast physi­cal population growth. Its population is around 370,000 but about half of them are migrants and another 100,000 people are forecast to migrate from other parts of the country to the district by 2020. Vice chairman of the district, says, "The district now needs 1.5 million to 2.0 million sq.m of housing for local residents and migrants."


  • 2007: By 2010, Viet­nam will need 100 mil­lion sq.m of housing, especially for the low income but the State is likely to meet only half of the demand, leaving a lot of room for private and foreign investors.


  • Viet Nam built a total of 25 million sq.m of housing space last year, putting the country's current total housing floor area to more than 890 million sq.m, according to the Ministry of Construction. The average housing floor per capita is 10.8 sq.m in urban areas and 10.5 sq.m in rural areas. The Ministry of Construction has planned to increase housing space by 28-30 million sq.m a year by 2020, raising the average housing space per capita to 12.2 sq.m.


  • HCMC is striving to obtain 10 million sq.m of civil construction space by 2010 according to the director of HCMC's Department of Construction. He added that the city will have 14 sq.m of construc­tion space per capita when the city's population reaches 10 million people in 2015-2020.


  • More than 2 million sqm of old apartments were built before 1980s in Hanoi, Ho Chi Minh City and Haiphong. Nearly all are seriously dilapidated. Hanoi has 23 residential quarters with a floor space of 1 million sq.m that has seriously deteriorated and needs urgent rehabilitation or rebuild­ing. All are low rises of 4-5 floors.


  • Over the next 5 years HCMC needs to build 25,000 houses for more than 100,000 public employees and 20,000 dormitories for about 120,000 migrant workers. The city’s Federation of Labour Unions proposed that the city would build houses with each having a floor space of 45-60sqm. Low income earners would pay in advance 30% of the house value and the rest by instalmets over 15-20 years.


  • The HCMC government has asked the agencies con­cerned to make more efforts to meet the target of building 25,000 houses for more than 100,000 workers and 20,000 dormitories for about 120,000 migrant employees in the city. The HCMC Department of Construction has presented three pilot projects that would build houses for rent and sale by installment plan to low-in­come workers. The three projects, worth a total of US$15.2 million, include building nearly 1,200 houses and public facilities in districts 7,9 and 12. The permissible maximum height of these apart­ment buildings for low-income people is 6 floors and each unit covers 30 to 60 square meters but they are proposing scaling up the height of new apartment buildings to 10 to 15 floors, citing the lack of land and the need to cut construction costs. According to the plan, the buyers must make a down pay­ment equivalent to 30% of the value of a house and pay the rest by installment over 15-20 years. The construction depart­ment's statistics show that nearly 22,000 civil servants in HCMC, 20% of the total, have yet to own a house or apartment. To put the plan on fast track, the city has proposed taking out a low-interest, 15-year loan of US$25 mil­lion from the Vietnam Devel­opment Bank.


  • According to studies conducted in 53 cities and provinces 200,158 State owned flats have so far been sold off, accounting for 58% of all State owned flats in the country.


  • The Minister of Construction reported that, “Upto 24% of urban houses are built without permits and in 2006 the figure soared to 34%.” In the first quarter of 2007 inspectors in Hanoi uncovered 692 construction projects being developed without permits or not in accordance with permits.


  • The HCMC government has mapped out a plan that envisages the average hous­ing area of city residents will rise to 14 square meters per person by 2010. Therefore, the city will have to annually build an additional 7 million square meters of hous­ing. There is also a program for developing 70,000 apart­ments for low and medium income people. Government Decree 90 forces investors to set aside one-fifth of land in a residen­tial infrastructure development project for local authorities to implement social housing pro­grams, especially for those fami­lies relocated, poverty-stricken and enjoying preferential State treatment. For investors, this is a very heavy burden. Several years ago, the HCMC government issued a rule requiring project devel­opers to set aside 10% of land or 20% of housing for the city to develop social housing programs. However, many investors proposed ful­filling this obligation by cash. Another bottleneck is the lack of finance. The official prices for land in some areas in the outlying district of Binh Chanh are $155/sqm. If site clearance com­pensation, ground leveling and infrastructure costs are taken into account, investors will find it hard to build apart­ments that are priced from $310-372, an afford­able price range for medium ­income people. HoREA says banks need to step up their involve­ment, such as supplying a loan equivalent to up to 80% of the value of an apartment and not requiring the borrower to show their financial capability. “How can low-income people show their financial capability? Singapore and Malaysia do not ask low income housing buyers to do this as the buyers can use their houses as collat­eral for the loans, and banks should not fix the re­payment duration; let the borrower do it instead.”


  • According to the HCM City Department of Construction, 138 resi­dential buildings in the city must be torn down as they are unfit for human habitation. The move is in response to the central Government's new directive to demolish unsafe housing in the country by 2016. HCM City authorities say that 14,570 families are living in pre-1975 buildings that could collapse. Residents were told that we would be relocated 10 years ago but noth­ing has happened. The Peoples Committee say progress has been slow because of the government's complicated procedures on planning, construction and financing. At least $89.5 million is needed to resettle 4,720 families living in these buildings by 2010.


  • If Hanoi continues to consume urban space at the current rate, there will be none left by 2010, according to deputy director of the Residential Settlement Institute. This situation has confirmed that the country's population is set to swell to at least 100 million by 2020, of whom 70% will live in cities he says quoting a prediction made by Or W Frenner, chief representa­tive of Konrad Adenauer. It is estimated urban ar­eas in Viet Nam will see a further surge of 6.13 million by 2010. This means the fun­damentals of life will compete with each other for space. The Government plan for land use by 2010, about 110,700 ha of agricul­tural land and outlying ar­eas are to be developed into inner city land. However, 103,000 ha was already taken by 2005. This leaves only about 7,800ha with which the government can use for existing projects. The Viet Nam Urban Plan­ning and Development Association said the Govern­ment has also approved a further 7,860 ha to serve the increasing population of 6.13 million people in urban areas in the country but if the increase is correct, the additional land will "not be enough," and "the cities will need thrice the area." According to a land use plan made by the Natural Resources and Environ­ment Ministry (MoNRE), by 2010 agricultural land will have increased to 9.4 mil­lion ha, from 8.8 million ha in 2000. However, per capita land allocation will de­crease due to rapid popula­tion growth. There was not enough cultivated land to support the figure. Some experts have said that Viet Nam's urban de­velopment is growing faster than any other country in the world.


  • According to Vietnam's land usage master plan to 2010, approved by the National Assembly last year, more than 110,000 hectares is expected to be diverted into new residential areas throughout Viet­nam. With more than six mil­lion people expected to flood urban areas, the coun­try needs another 21,000ha to be developed. The Institute for Residence Research director said, "We will need another 21,000 hectares to serve our increasing population. This figure is not small at all and it is a big challenge for us.” By 2020, the Vietnamese population will be more than 100 million, 70% of which will live in urban areas. With the increase in population, the current average land per person ratio has dropped to only 5 square metres. In 1998, architect Hoang Phuc Thang researched the planning ability of Vietnam's authorities. He discovered that because of the backwards planning capabilities, a detailed local plan for all urban areas of the country would only be available in 500 years. By the end of 2005, there were only 20 million people liv­ing in urban areas. The fig­ure is expected to rise to 50 million by 2020 and another 500,000 hectares will be needed. According to the figures from the Vietnam Urban Association, in order to supply services for this 50 million population, the country would have to invest $8.9 billion by 2010 and $13 billion by 2020 in fresh water, drainage and waste treatment services. Hospitals, accommodation and schools will also be required. "There must be accurate measures for urban devel­opment in Vietnam now or the country will fall into the tragedy of uncontrol­lable urbanization."


  • Deputy Minister of Con­struction said the country had some 700 urban areas, including 93 cities and towns, which accounted for 28% of the country's population. Around 1 million people migrated from rural to urban areas every year. Ministry figures put urbanisation at 18.5% in 1989, 20.5% in 1997 and 28% in 2006. It predicts the urbanisation rate to reach 45% by 2020. In HCM City and Ha N6i, this urbanisation rate could be 30-32% by 2010 and 55-65% by 2020. The experts said HCM City would take the lead in urbanisation and its popula­tion could jump to more than 10 million by 2020.


  • According to the construction department, the current rent for a 60sqm apartment is between USD$56-106 per month. The monthly repayment while buying a USD$18,660 apartment is USDS$168 per month for a 15 year term.


  • According to the ACB Real Estate Company (one of the largest mortgage lenders), in September 2007, the average price of a house was 300 taels of gold (a tael = 1.2 troy ounces) ie USD$264,444.


  • Vietnam's urban area will in­crease to 460,00 hectares in 2020 from the current 105,000 hectares under a national strategy on urban development, according to direc­tor of the Housing Management Depart­ment under the Construction Minis­try. Urbanisation around the country is expected to in­crease with 30% cent of localities urbanised by 2010 and 50% by 2020 according to VREA, with a current urbanisation rate of 28% and anticipated urbanisation rate of 45% in 2025. Demand, especially for housing, will be great and it is estimated that 366 million sqm of housing, includ­ing 176 million sqm in ur­ban areas and 190 million in rural areas will be needed. From now to 2020 about 35 million sqm of housing must be built a year to meet the increasing demand for accommodation. Foreign invest­ment in the sector would range from USD$8 billion to USD$10 billion in 5 years.


  • Vietnam hosts 729 urban areas at present. From 2007-­2010 the Real Estate & Housing Association pre­dicts that the nation will build 366 million sq.m of housing, including 176 mil­lion sq.m and 190 million sq.m in urban and rural ar­eas, respectively.


  • In early 2008 the Construction Ministry’s Depart of Housing and Real Esate Market Management announced that it was mapping out a project to build 500,000 apartments in new residential areas across the country, especially Hanoi and HCMC for low income residents. The project was finally unveiled 2 years after the policy was announced, but since then no low income housing has been built.


  • In early 2008 HCMC’s People's Committee announced plans to build 11,000 apartments in the South in 3 resettlement areas at Phong Phu, An Phu Tay, Phuoc Kieng Communes in Binh Chanh District. Each apartment building will adhere to the Sky Garden model from Phu My Hung Company. As estimated 18 buildings, of around 10 to 20 storeys will be built.


  • According to the Real Es­tate & Housing Associa­tion, from 2007-2010 Viet Nam will need to build 366 million sqm of housing includ­ing 176 million sqm in ur­ban areas and 190 million sqm in rural areas.


  • In Hanoi 4 plans have been developed to build 1,565 houses for low income people but only 168 units have been completed. In HCMC it takes at least 2 years to ask for a permit to build a low income housing project. An apartment in the city’s outlying areas costs an average USD$31,000. An employee with a monthly income of USD$315 who saved USD$125 a month would have to work 20 years to afford a house.


  • The nation's total housing reserves are now about 900 million sqm with 35 million sqm added every year, according to Deputy Minis­ter of Construction. Space per capita is around 10.5 sqm, a figure expected to reach 15 sqm by 2012.


  • About 16,000 of 81,000 expatriates living in Viet­nam will be eligible for owning apartments. In theory, they need 16,000 apartments with an esti­mated area of between 1.6 and 2.4 million sqm. Statistics show that HCMC has an additional housing area of 6.5 million sqm each year, and Hanoi 1.5 million sqm. By 2011 the number of luxury apartments will increase by 30,000 in HCM City and 6,000 in Hanoi. About 4,000 apartments and houses with an area of 660,000 sqm in HCM City are be­ing leased to foreigners, mainly in the Saigon South, and districts 1, 2, 3 and 5, and Phu Nhuan District. The figure in Hanoi is 1,300 apartments and houses, and 220,000 sqm. Rents in HCM City are higher than those in Hanoi, with the average monthly rent ranging from US$1,000-1,500 / house or apartment in the south­ern city, and from US$700-1,000 in the capital.


  • There are 37 million square metres of newly built houses each year including 27 million square metres in urban areas – Minister of Construction mid-2008.


  • According to the Ministry of Construction, Vietnam’s urbanisation rate will grow 30% annually between now and 2010 and 50% between 2010-2020.


  • In mid-2008 the Min­istry of Construction pro­posed a budget of more than USD$10.8 bil­lion to upgrade infrastructure for 95 urban areas. The project is planned to be financed by local budgets and interna­tional loans. The Minister said increasing urban­ization and rural-urban migra­tion have led to an overload for the current public facilities and thus a decline in living standards and arise in environ­mental pollution. According to the proposal infrastructure for these residential areas should be upgraded by 2020. A recent survey of house­holds in urban areas through­out the country shows that 882,000 families do not have running water and around 44,000 others are living in un­safe conditions. Moreover, 1.8 million houses are unfit for use and in desperate need of repair.


  • According to the Ha Noi Socio-Economic Research Institute in late 2008, individuals in Vietnam have on average 7sqm of living space but 30% of urban dwellers have only 4 sqm each. Moreover 60% of residential areas are badly in need of renovations. The Japan International Co-orperation Agency said before the city was expanded that Ha Noi was experiencing a severe housing shortage lacking 7 million sqm of space or 120,000 necessary apart­ments, and around 70% of the city's house­holds have an income level below USD$600 per year. A Natural Resources of the ­Environment and Real Es­tate Department report for 2006-07 stated that Ha Noi needed around 7,700 apartments to house people dis­placed by new city projects alone, though there were only around 5,000 available, adding that though low income housing was most appropriate (given pricing, payment methods and other factors) for State workers, the present income of State staff was insufficient for a USD$17,964-USD$23,952 / VND300-400 million apartment. They also estimated that a uni­versity graduate in a couple with an income of around USD$150 / VND2.5 million per month would have to not spend any money for 10 solid years to save enough to afford a low-income apartment.


  • By 2020 the country's real estate market will need some 1,300 million square metres of housing, equaling some 16 million apartments. A survey revealed that only 14% of Hanoi's housing is apartments in a city with a population density of 368,000 people per


  • FDI worth US$45.28 billion was committed in the first 7 months of 2008, almost 5 times the figure for the same period in 2007. Of this, $21.4 billion, or 48% was in the real estate sector. HCM City at­tracted the second-highest amount among all provinces and cities with US$7.9 billion, 90% of it in the property sector. Housing demand is very high and urban residents accounted for approximately 30% of the population in 2007 and will reach 40% in 2010. Over 13 mil­lion young people are at the fam­ily formation age. About 100 million sqm of housing needs to be added in cities to reach the norm of 15sqm per person, which is the target by 2010.


  • In late 2008, the Ministry of Construction pro­posed that the Prime Minister approve a programme to build 184,000 houses for low-income people in urban centres between 2009 and 2015. The programme needs an invest­ment of VND49 trillion / US$2.97 billion from central and provincial budgets and different economic sectors. According to the ministry, of the 2 million civil servants in the coun­try, 700,000 of them who live in urban centres do not have housing and often live with relatives. The low-income housing programme hopes to pro­vide 26,000 houses with a total floor space of 1.36 mil­lion sq.m of space each year. A typical family in an urban centre has an average in­come of VND4-6 million a month. At least 20 years of sav­ings are needed to buy an average apartment in a high-rise residential build­ing at the cost of VND800 million-VND1 billion / USD$50,000-62,500 per unit.


  • In late 2008 the Ha Noi City People's Committee has approved a plan to build rental housing for residents having difficulties finding accommodation. According to the regula­tions, beneficiaries from the plan include State of­ficials and employees, military officers and career soldiers, and workers in economic zones, industrial zones, export processing zones, and high-tech zones. From now to 2010, the city will continue to build three kinds of flats. The 1st will be for short-term rent and the 2nd will be for long-term lease with the option to buy at 20% down payment. The 3rd option will offer 864 flats for rent to workers in industrial zones. Total cost for the project is estimated at USD$41 million. These apartment blocks will consist of 6 floors without elevators, and they will use locally-made home appliances and enamelled tiles to reduce construction costs. Each flat will be from 35-60sqm for young fami­lies and families with 2 children. Rent prices will follow Government regulations so range from $0.9-1.67/sqm per month. According to the city's Construction Department, from now to 2010, the city will need some 7 million sqm of accommodation (equivalent to 120,000 flats). Civil servants will need around 18,000 flats, while workers of industrial zones will need 250,000sqm equivalent to 6,000 flats.


  • Property prices in some major cit­ies have declined nearly 60% compared with figures posted at the end of last year, but experts say prices are still too high for many people to afford. According to one property management firm, as much as 80% of the country's population can't afford to buy property. The Ministry of Construction calculated that if a couple can save VND5 million ($300) a month, it will take them up to 16 years to afford a VND1 billion ($60,600) apartment. The country's total hous­ing reserve is now around 926 million sq.m, and is fore­cast to hit 1.27 billion sq.m in 2010, according to Ministry of Construction official Pham Khanh Toan. Urban housing growth rates aver­age around 15% per year. Per capita housing spaces are now around 10.7sqm and expected to reach 14.5sqm in 2010.


  • Vietnam is striving to build 35 million sqm of housing each year to achieve a per capita space of 20sqm in urban areas by 2020.


  • Housing demand in Vietnam is enor­mous. According to the deputy minister of Construction, the current housing area in Vietnam's urban areas averages only 11 sqm per person, which is targeted to rise to 14 sqm by 2010. "[In line with this assump­tion] As Vietnam has an urban population of 22 mil­lion, it will need 22 million sqm of housing for every increased square meter.” Some 60% of the Vietnamese population are under 30, of whom 27% are living in urban areas. Ac­cording to the Ministry of Construction, HCM City has an average housing area of 10.6 sqm per per­son, which is much lower than the world's average. To reach the per capita level of 14 sqm set for 2010 and 20 square meters for 2020, many more hous­ing projects must be materialized.


  • At the end of 2008 the Ministry of Construction has asked the Government to proceed with a social housing program worth around VND49 trillion / $2.88bn to develop some 200,000 apartments in 2009-2015 to meet 30% of demand in Hanoi and HCMC. Investors are encouraged to join the program with incentives such as pref­erential tax, financial and site clearance support, and land use fee exemptions, among others. However, many said the program still has a long way to go from paper to reality as the procedures for construction often take 2 years or even longer.


  • HCM City will invest over VND4 trillion / $235.5m in upgrading 13 old apartment buildings to provide around 3,700 apartments in 2010 whilst the Ministry of Construction plans to set aside VND2.5 trillion / $147.2m to build houses for the low income, mainly in Hanoi and HCM City.


  • The Ministry of Construction has urged the government to take $147 million from the state's $1 billion stimulus package, to devel­op 6 housing projects in Hanoi and Ho Chi Minh City. The government earlier said it would use the funds for a list of transport and housing projects and for low-income state employees, workers and students. If the proposal gets the green light, it will benefit about 60,000 people and bring 10,000 low­ priced apartments online in 2009 and 2010. The Ho Chi Minh City Real Estate Association said the pro­posed $147 million package pales in comparison to the expected requirement of around VND 10,000 billion ($588 million) to develop accommodation for lower income people in Hanoi and Ho Chi Minh City. "The interest rate is still unrea­sonable at a base rate of 8.5%." The $147 million plan is part of a wider MoC plan to invest $2.97 billion into social housing development from 2009 to 2015. If approved, the plan will see 200,000 apartments built on 9.8m sqm which will meet 30% of social housing demand in the cities.


  • In 2009 the Viet Nam Corporation of Housing & Urban Development (HUD) under the Ministry of Construction announced that it would focus on housing development programmes for low income people, including providing 500,000sqm of housing floor in major cities of Ha Noi and HCMC, marking a 180,000sqm increase on 2008. The main recipients of the housing are intended to be government employees, teachers, workers and students in the cities' fringe areas.


  • In early 2009 each enterprise under the Ministry of Construc­tion was asked to build at least one local policy housing project to push up the program of building low-priced house for policy people in 2009. The ministry expected to complete 180,000 houses within 7 years.


  • Upto 24 housing projects will begin in HCMC in 2009 providing 11,000 homes for low income families, and 8 condominiums will also be built.


  • In early 2009 the Ha Noi Construction Department announced plans to build 2.5 million sqm of floor space in 2009 as part of its housing development programme through 2020. The departme nt will also focus on projects to build houses for public employees, teachers and workers who are low-income people. The projects involve more than 1,000 high-rise residential apartments in new urban zones.


  • In early 2009, the Ministry of Construction announced that it was seeking PM approval for the national social housing project to build 44,000 apartments in 2009-2010 for low-income earners. This is part of the program to build up to 184,000 apartments for lease and sales at low prices from now to 2015. The project, offering 50sqm apartments priced at VND250-300 million each / $14,700-$17.650 ie $294-$353/sqm will be launched in 2 populous cities of Hanoi and Ho Chi Minh, and in 2 southern provinces of Binh Duong and Dong Nai in this year.


  • 180209-The Ministry of Construction has set a target of building about 10,000 affordable houses for low-income earners between now and 2010. The US$142.9 million plan is aimed to provide accommodation for about 60,000 people residing primarily in Ha Noi, Dong Nai, Binh Duong and HCM City. This is part of the ministry's seven-year strategy to build 184,000 low-cost houses for poor people. The plan, which has already been submitted to the Government for approval, has an estimated cost of $2.88bn, half of which will come from the State budget and the rest is expected to be mobilised from other economic sectors. The ministry has also proposed that the Government allow poor people to pay only 20% of the homes' value, with the rest paid through 15-20 year installments. A 50sqm flat will be priced at only $17,650 ie $350/sqm. According to the General Sta­tistics Department, the country now has nearly 2 million state' employees, one third of which have not yet had stable accommo­dation.


  • Vietnam needs about 30m sqm of land to develop low-cost accommodation annually over the next 10 years, according to the MoC. There are about 600 uni­versities and colleges nationwide with some 3 million students in need of accommodation by 2015, resulting in the required capital of VND21 trillion ($1.2 billion) to develop accommodation for them.





Square Metre Prices - Vietnam Compared to Continent


Hong Kong

























House Price to Income Ratio - Vietnam Compared to Continent
















Hong Kong









22.78x – late 2008




Last Updated ( Tuesday, 04 August 2009 )
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