How is the property market forecast in Ho Chi Minh City?

Authored by the expert who managed and guided the team behind the Vietnam Property Pack

Yes, the analysis of Ho Chi Minh City's property market is included in our pack

Who is the author of this content?

BAMBOOROUTES

A team specialized in real estate investing in APAC countries (Japan, Thailand, Indonesia, Australia, etc.).

We are a team of financial experts, legal professionals, developers, and local real estate specialists dedicated to helping people like you avoid mistakes when investing in real estate in a foreign place, particularly in Ho Chi Minh City. If you'd like to learn more about us, you can check our presentation page.

How this content was created 🔎📝

At BambooRoutes, we explore the Vietnamese real estate market every day. Our team doesn't just analyze data from a distance—we're actively engaging with local realtors, investors, and property managers in cities like Ho Chi Minh City, Hanoi, and Da Nang. This hands-on approach allows us to gain a deep understanding of the market from the inside out.

These observations are originally based on what we've learned through these conversations and our observations. But it was not enough. To back them up, we also needed to rely on trusted resources

We prioritize accuracy and authority. Trends lacking solid data or expert validation were excluded.

Trustworthiness is central to our work. Every source and citation is clearly listed, ensuring transparency. A writing AI-powered tool was used solely to refine readability and engagement.

To make the information accessible, our team designed custom infographics that clarify key points. We hope you will like them! All illustrations and media were created in-house and added manually.

What's the current average price per square meter for apartments in Ho Chi Minh City, and how has it changed in the past 12 months?

The average price for apartments in Ho Chi Minh City reached $4,691 per square meter as of September 2025.

This represents a dramatic 47% year-on-year increase, making Ho Chi Minh City one of the fastest-growing property markets in Southeast Asia. The surge stems from acute supply shortages, major infrastructure investments, and increased foreign capital flowing into the market.

Luxury apartments in central areas command significantly higher prices, with some premium developments reaching up to $15,000 per square meter. The standard luxury segment typically ranges from $5,000-7,000 per square meter in District 1, while emerging areas like Thu Duc offer more accessible pricing at $2,500-4,000 per square meter.

Supply constraints have been the primary driver of this price acceleration, with developers facing regulatory delays and land acquisition challenges. Combined with strong demand from both local buyers and foreign investors, this has created the perfect storm for rapid price appreciation.

The 47% increase far exceeds wage growth and inflation, raising affordability concerns for middle-income Vietnamese families looking to enter the property market.

How do price trends differ between central districts like District 1 and emerging areas like Thu Duc or Binh Chanh?

Price differentials between Ho Chi Minh City's districts show stark contrasts, with District 1 commanding triple the prices of emerging areas.

District	Price Range (per sqm)	12-Month Growth
District 1 (CBD)	$5,000-7,000	20-30%
Premium District 1	Up to $23,500	25-35%
Thu Duc	$2,500-4,000	10-15%
Binh Chanh	$1,570-2,000	8-12%
District 2	$3,000-4,500	15-20%
Binh Thanh	$2,800-3,800	12-18%
District 7	$2,200-3,500	10-15%

What's the current rental yield percentage for residential properties, and how does it compare with other Southeast Asian cities?

Rental yields for residential properties in Ho Chi Minh City range from 4.0% to 6.5%, depending on location and property type.

Central districts like District 1 typically deliver yields at the lower end (4.0-4.5%) due to higher purchase prices, while emerging areas such as Thu Duc and Binh Chanh can achieve 5.5-6.5% yields. Mid-tier districts like District 7 and Binh Thanh generally offer 5.0-5.8% rental returns.

Compared to regional markets, Ho Chi Minh City's yields remain competitive. Singapore averages around 3% due to extremely high property values, while Bangkok offers similar 4.0-5.5% returns. Jakarta and Manila provide higher yields of 6-7%, reflecting their lower property prices relative to rental income potential.

It's something we develop in our Vietnam property pack.

The yield advantage of emerging districts makes them attractive for investors seeking higher returns, especially as infrastructure improvements continue to drive capital appreciation in these areas.

How many new housing units are expected to be delivered this year, and how does that compare with last year's supply?

Ho Chi Minh City expects approximately 20,583 new apartment units to be delivered in 2025, marking a 40% increase from the previous year.

The first half of 2025 already saw new launches exceeding 10,000 units, which is 3.1 times higher than the same period in 2024. This dramatic increase comes after the market experienced its lowest new apartment supply in a decade during early 2024, creating pent-up demand and contributing to current price pressures.

Despite this supply increase, the new units primarily target the mid to high-end segments, with limited affordable housing options for first-time buyers. Most new developments focus on areas like Thu Duc, District 2, and District 9, where land availability and infrastructure development create opportunities for large-scale projects.

The supply recovery reflects developers' confidence in market fundamentals and their ability to navigate regulatory challenges that previously caused delays. However, this level of new supply still falls short of underlying demand from population growth and urbanization trends.

Looking ahead, supply constraints are expected to persist as land becomes increasingly scarce in desirable locations, supporting continued price appreciation across the city.

What's the current vacancy rate in both residential and commercial segments, and is it trending up or down?

Residential vacancy rates in Ho Chi Minh City's central districts have reached record lows due to strong absorption, while emerging districts maintain higher but declining vacancy levels.

Central areas like District 1, District 3, and District 7 show residential vacancy rates below 3%, reflecting intense demand and limited available inventory. The tight residential market has pushed rental rates upward and created bidding situations for desirable properties.

Emerging districts including Thu Duc, Binh Chanh, and District 9 maintain higher vacancy rates of 8-12%, though these are trending downward as infrastructure improvements and price differentials attract more residents and investors to these areas.

Commercial vacancy rates present a different picture, trending upward particularly in older office stock and retail centers. New commercial supply coming online has increased competition, with some older Grade B and C office buildings experiencing vacancy rates of 15-20%. Modern Grade A office spaces maintain lower vacancy rates of 5-8%.

The divergent trends reflect the residential market's supply-demand imbalance versus the commercial sector's more balanced supply pipeline and changing workplace preferences post-pandemic.

How much foreign direct investment has flowed into real estate in Ho Chi Minh City over the past year, and from which countries?

Foreign direct investment into Ho Chi Minh City's real estate sector has reached record levels over the past 12 months, with billions of USD flowing into the market.

The primary sources of foreign investment include:

1. **Singapore** - Leading investor focusing on luxury residential developments and mixed-use projects2. **South Korea** - Major investments in residential towers and commercial developments3. **Japan** - Concentrated investments in logistics, industrial real estate, and mid-tier residential projects 4. **Mainland China** - Significant capital in high-end residential and hospitality developments5. **Hong Kong** - Investments primarily in premium residential and office developments

Foreign capital has particularly concentrated in luxury residential projects, mixed-use developments combining retail and residential components, and logistics facilities serving Ho Chi Minh City's growing e-commerce and manufacturing sectors.

This foreign investment surge has contributed significantly to price appreciation, especially in segments attractive to international buyers. The influx has also raised quality standards and introduced international design and development practices to the local market.

Government policies continue to facilitate foreign investment while maintaining restrictions on direct land ownership, channeling most foreign capital through joint ventures and development partnerships with Vietnamese entities.

What is the average mortgage interest rate right now, and how affordable are loans compared to median household incomes?

Current mortgage interest rates in Ho Chi Minh City range from 9% to 11% per annum for new loans, creating significant affordability challenges for potential homebuyers.

These rates remain elevated compared to developed markets, reflecting Vietnam's monetary policy stance and banking sector risk assessment. Most banks require 20-30% down payments for residential purchases, with stricter criteria for foreign buyers requiring 30-50% down payments.

Loan affordability has become critically tight as median household income growth has failed to keep pace with the 47% property price surge. A typical middle-class family earning the median income would need to allocate 60-80% of their gross income to mortgage payments for an average apartment, far exceeding the recommended 30% debt-to-income ratio.

First-time buyers and low-to-middle-income families face particular challenges, with many priced out of central districts entirely. This affordability crisis has pushed buyers toward emerging areas or smaller unit sizes, contributing to demand shifts across different districts.

It's something we develop in our Vietnam property pack.

Banks have responded by extending loan terms to 25-30 years and introducing more flexible income verification processes, but fundamental affordability concerns persist.

How has government regulation—such as land laws, ownership rules for foreigners, or tax policies—shifted in the past 2 years?

Government regulation in Ho Chi Minh City's real estate sector has undergone significant changes over the past two years, impacting pricing and market access.

Land valuation reforms have been implemented, updating price frameworks that were previously outdated by decades. These changes resulted in higher official land values, directly increasing transaction costs and contributing to overall price appreciation across all districts.

Foreign ownership regulations have become more strictly enforced, with enhanced verification processes for foreign buyers and tighter monitoring of ownership structures. While foreigners can still purchase condominiums (up to 30% of units in a development), the approval process now requires more documentation and takes longer to complete.

Property transaction tax adjustments have been introduced, with higher transfer taxes and registration fees. The government has also implemented stricter anti-speculation measures, including holding period requirements and additional taxes on quick property flips.

These regulatory shifts aim to cool speculative activity while ensuring sustainable market development, though they have contributed to higher transaction costs and complexity for both domestic and foreign buyers.

We did some research and made this infographic to help you quickly compare rental yields of the major cities in Vietnam versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.

What percentage of transactions are currently cash purchases versus mortgage-financed purchases?

Cash purchases dominate Ho Chi Minh City's residential property market, accounting for approximately 60-70% of all transactions as of September 2025.

This high cash ratio reflects several market dynamics. Wealthy Vietnamese buyers and foreign investors often prefer cash transactions to avoid mortgage complications and secure better negotiating positions. The 9-11% mortgage rates also make cash purchases more attractive when buyers have available liquidity.

The luxury segment shows even higher cash ratios, with 80-90% of transactions above $500,000 completed without financing. International buyers particularly favor cash purchases due to more complex mortgage requirements for non-residents.

Mortgage-financed purchases represent 30-40% of transactions, concentrated in the mid-market segment where first-time buyers and young professionals rely on bank financing. However, strict lending criteria and high interest rates limit mortgage accessibility for many potential buyers.

This cash-heavy market structure contributes to price volatility and can amplify both upward and downward price movements, as cash buyers can move more quickly than those dependent on mortgage approvals.

How strong is the demand side—measured by transaction volumes, absorption rates, or the number of new buyers entering the market?

Demand fundamentals in Ho Chi Minh City's property market remain exceptionally strong, with transaction volumes increasing 3.3 times year-on-year in Q2 2025.

Absorption rates for new developments have accelerated dramatically, with many projects selling 70-90% of units within the first month of launch. This rapid absorption contrasts sharply with the slower sales pace experienced in 2023-early 2024, indicating renewed buyer confidence and urgency.

The number of new buyers entering the market has expanded significantly, driven by several factors including returning overseas Vietnamese, young professionals upgrading from rental to ownership, and investors capitalizing on infrastructure development opportunities.

Population growth and continued urbanization provide underlying demand support, with Ho Chi Minh City attracting migrants from rural areas and other Vietnamese cities seeking employment opportunities. The city's economic dynamism continues to drive housing demand from both residents and investors.

It's something we develop in our Vietnam property pack.

First-time buyer activity has intensified despite affordability challenges, with many stretching budgets or accepting smaller units to enter the market before prices rise further.

What large-scale infrastructure projects are underway, and how are they expected to impact property values?

Major infrastructure developments are transforming Ho Chi Minh City's property landscape and driving significant value appreciation in affected areas.

Metro Line 1, nearing completion, connects Ben Thanh Market in District 1 to Suoi Tien in Thu Duc, dramatically improving accessibility and reducing travel times. Properties within 1 kilometer of metro stations have already experienced 15-25% price premiums.

New bridge constructions across the Saigon River are enhancing connectivity between districts. The Thu Thiem Bridge expansion and planned additional crossings will reduce traffic congestion and make eastern districts more accessible to the city center.

Expressway developments including the Ring Road 3 and connections to surrounding provinces are opening new development corridors. Areas along these routes, particularly in Binh Chanh and Cu Chi districts, are experiencing early-stage price appreciation as accessibility improves.

The Thu Thiem New Urban Area continues expansion as Ho Chi Minh City's new financial district, with major international banks and corporations establishing headquarters. This development is driving luxury residential demand in District 2 and surrounding areas.

These infrastructure investments are particularly benefiting Thu Duc, Binh Thanh, and District 2, where proximity to new transportation links is accelerating both rental demand and capital appreciation.

How do analysts forecast property prices and rental yields in Ho Chi Minh City over the next 3 to 5 years, with specific percentage ranges?

Property analysts project continued robust growth for Ho Chi Minh City's real estate market over the next 3-5 years, though at more moderate rates than the current 47% surge.

Price forecasts indicate annual appreciation of 8-10% through 2030, driven by sustained infrastructure investment, population growth, and continued foreign capital inflows. Central districts may see slower percentage gains (6-8%) due to their already elevated base prices, while emerging areas could maintain 10-15% annual growth as infrastructure projects mature.

Rental yields are expected to remain stable or decline slightly as property prices rise faster than rental rates. Current yields of 4.0-6.5% may compress to 3.5-5.5% by 2028-2030 as capital appreciation outpaces rental income growth.

Prime districts will likely maintain value resilience due to scarcity and continued international demand, though the rate of appreciation may moderate. Districts benefiting from new infrastructure, particularly Thu Duc and areas along metro lines, are projected to outperform the overall market.

Risk factors include potential interest rate changes, regulatory adjustments, and global economic conditions affecting foreign investment flows. However, the fundamental drivers of urbanization, infrastructure development, and economic growth support continued positive market momentum.

Conclusion

This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.

Sources

1. BambooRoutes - Average House Price in Ho Chi Minh City
2. The Investor - HCMC Apartment Prices Continue to Rise
3. BambooRoutes - Ho Chi Minh City Price Forecasts
4. VietnamPlus - HCM City Apartment Prices Hit Record Highs
5. Huttons Vietnam - Thu Duc City New Apartment Prices Rise
6. Global Property Guide - Vietnam Price History
7. Xinhua - Vietnam Property Market Update
8. VnExpress - HCMC Apartment Prices Climb on Secondary Market