Experts predict a new dynamic for Hanoi’s real estate market in 2025, with a stronger presence of foreign investors partnering with major domestic developers.

This shift could make it harder for small investors to compete in an increasingly high-stakes market.

A real estate boom from apartments to land auctions

According to the Ministry of Construction’s 2024 market report, property prices in Hanoi and Ho Chi Minh City surged compared to 2023, with Hanoi leading in price increases.

Rising demand has pushed apartment prices to new heights. The once-affordable segment, previously priced below 30 million VND (approximately 1,190 USD) per square meter, now starts at under 45 million VND (1,780 USD).

Mid-range apartments, once priced between 30-45 million VND (1,190-1,780 USD), have climbed to 45-70 million VND (1,780-2,770 USD).

Meanwhile, the high-end segment, previously ranging from 50-70 million VND (1,980-2,770 USD), now costs between 70-100 million VND (2,770-3,960 USD), reflecting an increase of 28-44%.

Data from CBRE shows that by Q4 2024, the average selling price for new apartments in Hanoi reached 72 million VND (2,850 USD) per square meter - the highest in the city's real estate history.

New projects priced under 60 million VND (2,370 USD) per square meter have become nearly nonexistent, with some developments in suburban districts like Dong Anh exceeding 100 million VND (3,960 USD) per square meter.

Not only have new apartments seen record-high prices, but resale properties have also soared. CBRE reports that Hanoi’s secondary apartment market saw a price increase of over 26% in 2024 - the highest recorded to date - reaching an average of 48 million VND (1,890 USD) per square meter.

Beyond apartments, suburban land auctions became another major hotspot in 2024. Auctions in districts like Thanh Oai and Hoai Duc attracted massive interest, with bidding sessions lasting overnight.

Final sale prices skyrocketed to several times the starting bids, making land auctions one of the most competitive real estate sectors.

The rapid price surge has affected all property types, from suburban plots to small alleyway houses in the city center, making homeownership increasingly difficult for ordinary buyers.

A shrinking opportunity for small investors?

Do Thu Hang, Senior Director at Savills Hanoi, believes that Hanoi’s real estate market—like the broader national market - is entering a new cycle of development in 2025.

According to Hang, this cycle will focus on sustainability, driven by stronger legal frameworks and macroeconomic growth. The introduction of updated real estate, land, and housing laws, along with Hanoi’s 2021-2030 urban planning vision, will provide clearer development directions.

“In this new market cycle, a more complete legal framework will intensify competition, leading to a new level of project and developer screening. In the past, having capital and a project was enough to enter the market. Now, developers must prove their reputation, experience, and financial strength to succeed,” Hang explained.

A key difference in this cycle is the increasing presence of foreign investors.

“Foreign investors are engaging more deeply in Vietnam’s real estate market, diversifying investment portfolios, and forming partnerships with major domestic developers.

These collaborations, backed by strong financial resources, will elevate market standards but also limit opportunities for small investors,” she added.

Assessing the apartment sector for 2025, Associate Professor Dr. Dinh Trong Thinh expects price growth to slow down, with the market stabilizing rather than experiencing the heated surges of previous years.

As a result, buyers are likely to shift their focus from overpriced areas to locations with more competitive prices and higher growth potential.

Meanwhile, Pham Duc Toan, CEO of EZ Property, believes that Hanoi’s apartment prices will be unlikely to decline. However, he warns that apartments will become less attractive for investors, as profits will be harder to achieve.

“Apartments will remain suitable for end-users, but investors may find themselves stuck in unprofitable holdings,” he said.

Experts advise investors to carefully evaluate areas where prices have already peaked and consider regions with strong economic and industrial growth potential, as these locations offer better profit margins.

Hong Khanh