Viet Nam Serviced Apartment Market Overview Q1/2025

Savills Q1/2025 Market Brief indicates that the serviced apartment segment in Viet Nam continues to show positive momentum in the two major cities of HCMC and Ha Noi. In HCMC, supply has recorded a slight decline due to the withdrawal of several projects from the market, while rental rates and occupancy levels are stable. In contrast, Ha Noi saw modest growth in supply, rents, and occupancy.

Let’s explore the key developments in each market to gain a clearer picture of the serviced apartment segment in early 2025.

1/ HCMC serviced apartment market in Q1/2025

Supply Decline in Q1/2025

In Q1/2025, HCMC’s serviced apartment market experienced a slight decrease in supply, down 3% quarter-on-quarter (QoQ) and 6% year-on-year (YoY), reaching approximately 7,995 units. This decline was primarily due to the withdrawal of 338 units across 10 projects. However, the market also welcomed new supply from two expansion projects and two newly launched projects operated by reputable chains such as CityHouse and M Village, adding 98 Grade C units to the market. 

Future supply is expected to remain limited. In 2025, only around 163 new units are projected to enter the market, mainly from renovation projects located in non-central areas. By 2027, HCMC is forecasted to have an additional 659 serviced apartments from nine real estate projects in HCMC. Of these, approximately 53% will be located in central districts, promising greater diversity for the market over the medium and long term.

Cccupancy and rental rates for serviced apartments

Rental rates for serviced apartments in HCMC continued their upward trend in Q1/2025, reaching an average of VND 529,000/m²/month, equivalent to an increase of 1% quarter-on-quarter (QoQ) and 4% year-on-year (YoY). Notably, the Grade C segment recorded the strongest growth at 3%, driven by price adjustments across approximately 20 projects (accounting for 8% of the city’s total supply) after a prolonged period of price stability.

In the higher-end segments, Grade A rental rates declined slightly by 1% QoQ, while Grade B rents remained stable. The average occupancy rate across the market reached 81%, down 1% QoQ but showing year-on-year improvement. The short-term decline was primarily attributed to the expiry of rental contracts for expatriates in non-central areas and a temporary slowdown in short-term accommodation demand during the holiday period.

Net absorption for serviced apartments in Q1 recorded a negative 130 units, with the Grade C segment being the most affected, posting a negative absorption of 81 units, mainly concentrated in non-central areas. The Grade A segment also reported a negative net absorption of 51 units, while the Grade B segment remained largely stable, with a modest increase of two units.

Market outlook for serviced apartments

Despite current market challenges, the medium- and long-term outlook for HCMC’s serviced apartment sector remains highly promising, underpinned by robust growth in foreign direct investment (FDI). According to the Ministry of Planning and Investment, HCMC attracted US$1.4 billion in FDI in Q1/2025, representing a 58% YoY increase and ranking second nationwide. Newly registered capital alone accounted for US$422 million across 333 projects, with Singapore leading the way, contributing 76% of the total investment.

Additionally, regulatory changes regarding short-term accommodation are expected to positively impact the serviced apartment sector. Since 2014, short-term leasing in condominium apartments has been prohibited. Recently, Decision No. 26/2025/QD-UBND has further tightened regulations, mandating a shift from short-term rental apartments to legally compliant accommodation types such as serviced apartments. This development is poised to be a significant driver supporting the sustainable growth of the serviced apartment market in the future.

2/ Ha Noi serviced apartment market in Q1/2025

Rental rates and occupancy increase

In Q1/2025, Ha Noi’s serviced apartment market recorded stable supply, with a total of 6,246 units across 64 projects, reflecting a 3% year-on-year (YoY) increase; contributed by the addition of the Swiss-Belresidences Ha Noi project in Q3/2024.The average occupancy rate reached 86%, up 2% quarter-on-quarter (QoQ) and 4% YoY. Both the Grade A and Grade B segments reported improvements in occupancy rates, while the Grade C segment continued its slight downward trend, decreasing by 2% QoQ.

Average rental rates increased by 1% QoQ and 5% YoY. Rental rates in the Grade A and Grade C segments recorded growth during the quarter, while Grade B rental rates remained stable. These figures indicate that demand for serviced apartments in Ha Noi continues to maintain solid growth momentum despite the slight increase in supply.

Tenants at grade a serviced apartment projects

Foreign expatriates, primarily from Japan and South Korea, continue to dominate the tenant profile at Grade A serviced apartment projects in Ha Noi. These tenants typically work for foreign direct investment (FDI) enterprises, diplomatic missions, international banks, and multinational corporations.

The arrival of high-quality projects such as Lancaster Luminaire and Swiss-Belresidences Ha Noi has contributed to increased tenant demand in the Cau Giay and Dong Da districts. Meanwhile, tenants from other countries tend to favor areas like Nam Tu Liem, Tay Ho, and Ba Dinh, which offer the advantages of larger apartment spaces and quieter living environments.

Demand from surrounding provinces

In addition to local demand, Ha Noi’s serviced apartment market is also influenced by tenants from nearby industrial provinces such as Hai Phong, Ha Nam, Thai Binh, and Nam Dinh. However, in these areas, mid-income tenants with basic amenity needs are increasingly opting for local projects to reduce costs instead of relocating to Ha Noi.

Occupancy rates at projects in these provinces ranged from 70% to 90% in Q1/2025. Nevertheless, given the limited supply of high-quality serviced apartments in the provinces, Ha Noi is expected to maintain its position as the primary destination for tenants seeking premium accommodation in the near future.

Future supply of ha noi's serviced apartment market

From 2025 onward, Hanoi’s serviced apartment market is expected to welcome an additional 4,133 new units from 18 projects. Specifically, in 2025, seven projects are scheduled to deliver approximately 1,040 units, with Tay Ho View Complex set to be the largest contributor to Grade A supply during the year.

Around 78% of the future supply will be concentrated in the central districts, while the remaining 22% will be located in the western areas of Ha Noi. Notably, international operators will dominate, accounting for up to 83% of the total new supply. Major brands entering the market include The Ascott, Lotte Group, Pan Pacific, Shilla Hotels & Resorts, Marriott, Hilton, and Hyatt, promising to raise the standards of premium serviced apartment in the capital city

See more details in the Q1/2025 Market Brief from Savills just released.