Decoding the Prime Minister's question: Why do apartment prices keep rising?

(NLDO)- Enterprises want to do high-end projects, but the cost of making the product, including land costs, is high, so apartment prices keep increasing.

On the afternoon of September 22, at the regular meeting of the Central Steering Committee on housing policy and real estate market, Prime Minister Pham Minh Chinh - Head of the Steering Committee - asked the question: why do apartment prices keep rising?

"With prices of 70-100 million VND/m², how can people afford housing?" - The Prime Minister said and requested both management agencies and businesses to respond and resolve the issue together.

That question touches on the reality of what home buyers in Ho Chi Minh City have seen over the past 1-2 years: projects eligible for sale in the central area are almost all in the high-end segment, with common prices above 100 million VND/m².

A survey by a reporter from the Nguoi Lao Dong Newspaper shows that projects around Thu Thiem Center such as The OpusK Residence are offering prices of 250-350 million VND/m²; 1-2 km from the center, The Privé is also over 100 million VND/m², Lumiere Midtown exceeds 130 million VND/m², and Eton Park is over 120 million VND/m². Moving further away, even Vinhomes Grand Park - which is considered an "easy" choice, is now not less than 70 million VND/m².

Market reports from real estate research companies show that the average apartment price in Ho Chi Minh City is very high. Statistics released by DKRA Group in August 2025 recorded that the average price in the central area has increased to about 80 million VND/m², an increase of 12-18% compared to before; suburban areas such as Binh Duong (old) increased by 8-10%, currently around 47 million VND/m². The expectation that "after the merger there will be more products, lower prices" has only appeared sporadically in the adjacent areas, while in the city itself, the price level is still climbing.

Prime Minister Pham Minh Chinh speaks at the regular meeting of the Central Steering Committee on housing policy and real estate market.

Explaining the above situation, Dr. Pham Viet Thuan, Director of the Institute of Natural Resources and Environment Economics of Ho Chi Minh City, pointed out that the problem lies in the developer's own goals. According to him, "the target of setting the expected profit level is too high, if we implement high-end projects, then the housing prices cannot be low, causing the apartment prices to be higher every year than the previous year and if they are high, they will stay high forever."

In addition, he also pointed out that part of the problem comes from the "mechanism": the land price list and the method of calculating land use fees are putting a heavy burden on project costs, "to collect high land use taxes... it is difficult for the project to sell low". In addition, input costs, especially construction materials, are "in the sky" and cannot be controlled", all of which are added to the final selling price.

From a market perspective, Mr. Le Hoang Chau, Chairman of the Ho Chi Minh City Real Estate Association (HoREA), said he directly attended the meeting with the Government and "understands the Prime Minister's frustration".

According to Mr. Chau, there are many reasons for the high price level in big cities, but the root cause that has lasted for many years is the lack of supply in the affordable segment.

"Supply is scarce because many low-cost projects are stuck. After many years of implementation, prices have skyrocketed," he said, emphasizing that "legal problems account for more than 70% of the projects that cannot be implemented."

Mr. Chau said that when the products on the market are mainly high-end apartments commonly priced at over 70 million VND/m², the supply structure is reversed, creating an "upside-down tower model", meaning a mismatch in segments, and the market has been devoid of low-cost apartments for many years.

What HoREA is waiting for now is a strong enough policy impact to loosen the bottleneck. Mr. Chau hopes that the upcoming revision and improvement of the legal framework, especially the provisions of the Land Law, will create conditions for "favorable land use conversion projects", especially agricultural and industrial land that can be used for housing development.

"When there is more clean land, new supply will increase and that is the natural pull to cool down housing prices," he said. Along with that is the requirement to strongly promote the social housing program. "The government needs to speed up the progress, encourage businesses to develop social housing to create a common ground, reduce housing prices and give people homes," the HoREA chairman suggested.

Source: https://nld.com.vn/giai-ma-cau-hoi-cua-thu-tuong-vi-sao-gia-chung-cu-cu-cao-mai-196250923100110632.htm