Real Estate Market Performance in Early 2024

According to the Ho Chi Minh City Statistics Office, the real estate sector generated an estimated 22.932 trillion VND in revenue in January 2024. This figure accounted for 21.2% of the city’s total retail and service revenue, ranking second only to retail goods sales.

Although the market showed a 3.3% decline compared to December 2023, it remains a key economic contributor. In January, the city’s total retail and service revenue reached 107.996 trillion VND, marking a 7.5% increase from the same period last year.

Factors Influencing Real Estate Recovery

Despite facing persistent challenges, the real estate market is showing signs of recovery, largely due to government policies aimed at boosting economic growth. Key factors driving this recovery include:

  • Lower Interest Rates: The reduction in lending and deposit interest rates has facilitated easier access to capital for both businesses and homebuyers.
  • Regulatory Support: The government has implemented legal reforms to streamline project approvals and enhance market transparency.
  • Economic Stability: A stable economic environment is increasing investor confidence, and gradually revitalizing demand in the property sector.

Challenges Facing the Real Estate Industry

While real estate revenue remains substantial, the sector continues to face significant obstacles:

  • Limited Impact on Construction: The real estate market’s recovery has yet to translate into significant growth for the construction industry. In January, the construction sector grew by only 2.6%, contributing just 3.2% to the city’s GRDP.
  • Decline in New Businesses: The number of newly registered real estate firms dropped by 11.6%, with total registered capital falling by 23.3% compared to the previous year.
  • High Housing Costs: Property prices remain high, limiting homeownership opportunities for many residents despite market adjustments.

Strategies to Stimulate the Real Estate Market

To support further recovery and growth, the Ho Chi Minh City Statistics Office has proposed several measures:

  • Enhancing Legal Clarity: Prioritizing legal framework improvements to expedite project approvals and ensure compliance with the new Land Law 2024.
  • Boosting Infrastructure Investment: Expanding transportation and urban infrastructure to increase land value and accessibility.
  • Leveraging Digital Transformation: Implementing digital systems for real estate data management to improve transparency and efficiency.

Future Outlook for Ho Chi Minh City’s Real Estate Market

Looking ahead to 2025-2030, Ho Chi Minh City aims to strengthen land management policies, enhance urban planning efficiency, and attract more investment in residential and commercial projects. While short-term challenges remain, ongoing reforms and supportive policies are expected to fuel sustainable growth in the real estate sector.

Conclusion

Ho Chi Minh City’s real estate sector continues to be a crucial driver of economic activity, with revenue nearing 23 trillion VND in January 2024. While facing temporary slowdowns, ongoing policy support and infrastructure development indicate a promising long-term outlook for the market. Investors and homebuyers should closely monitor regulatory updates and economic trends to seize emerging opportunities in the evolving real estate landscape.