Why are Demands for Landed Property Rising in HCMC?

Landed properties have become increasingly popular after the pandemic, thanks to the space they give to residents. As supply in the city remains limited, neighbouring provinces such as Dong Nai and Binh Duong are satisfying demands. In the first quarter, supply levels increased following a shortage.

Improved Landed Property Supply

In Savills Q1/2022 report, supply levels improved after a chronic shortage. As the pandemic and extended lockdowns knocked supply levels, the successful vaccination campaign supported the implementation of new supply, with developers and investors regaining confidence. Primary supply levels reached 490 dwellings/plots, representing a 23% increase quarter-on-quarter (QoQ) and a 3% jump compared to Q1/2021. New supply was largely distributed away from the core in Districts 9,12, Binh Chanh, Tan Phu, and Thu Duc. It came from ten new projects and the next phases of two existing projects.

By the end of 2022, 1,130 dwellings/plots are expected to enter, which is a considerable jump from the existing supply. Most, or 56%, of the new offering, will come from reputable developers like Vingroup, Masterise Homes, Khang Dien, Keppel Land and Dai Phuc Group. To cater to post-pandemic demands, the supply will be in large compounds with large green areas and diverse facilities.

Troy Griffiths, Deputy Managing Director at Savills Viet Nam commented: "Landed property supply in Ho Chi Minh City continues to be low. The supply is moving towards neighbouring provinces such as Dong Nai and Binh Duong. With infrastructure development and available land banks, absorption of ready-built projects in Dong Nai reached 85% and Binh Duong reached 67%. However, the market shows signs of speculation, with about 65% of buyers buying for investment rather than occupation."

Read more: Waterfront Properties in The Centre of Ho Chi Minh City

Increased Demands

According to Ginny Nguyen, Senior Manager, Savills Residential Sales HCMC, after the pandemic, buyers looking for landed property want more green and private spaces and do not want to live in densely populated areas.

"Properties in urban areas outside of HCMC, like Dong Nai or Binh Duong, are great for customers looking to optimise on cost and value. We have seen robust activity and great absorption of villas between VND 30 and 40 billion. For example, villas at Aqua City and The Icon  - Swan Park sold out quickly, " Ginny commented.

Despite increasing demands, supply levels remain low. Although this has pushed up prices, clients are still interested in buying landed properties, either to live in or as investments. A notable project catering to shophouse and townhouse demands is The Global City in Thu Duc City. Despite prices reaching VND 370 million/m2, sales have been good thanks to the project’s proximity to HCMC and its positioning in the new Thu Duc hub.

Landed property buyers typically have property portfolios that they are looking to expand. They are particularly keen on new products in up-and-coming markets with potential. Properties in satellite markets are often purchased as second or vacation homes because they offer great amenities and green spaces but are still close to the city.

Ginny added: "Villa and townhouse development in satellite locations will increase. This is as land closer to the centre is limited and the licensing procedures are costly and complicated. We expect that savvy investors will continue to look at developing products in satellite cities to cut costs and cater to the market.”

Our Services: Savills Residential Department

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