Reasons for prolonged inventory of shophouses in Ho Chi Minh City

VTV.vn - High prices and areas exceeding demand have caused shophouses in apartments and townhouses in Ho Chi Minh City to be advertised for sale or lease for a long time but not finding customers.

In early September, Mr. D.T, a real estate broker in Cat Lai ward, posted on social media platforms to "push" the remaining two shophouses he had brokered for customers. Mr. D.T said this was the third time since the beginning of the year that he had pushed these products, but he still did not see any improvement. "The price of a shophouse in this area is nearly twice the price of an apartment, but there is not much demand," Mr. T said about the product he brokered.

The situation of shophouses in the apartment building's base being sluggish for a long time is not only happening in Cat Lat ward - where the population density is not high, but also in other areas such as Hiep Binh, An Lac where residents have filled up. This situation also happens with shophouses and townhouses in the central area, TOD areas with busy traffic connections. Recorded in mid-September by reporters in the An Phu metro station area, where there are many people passing by and located close to the bustling Thao Dien shopping center, many shophouses and townhouses are still in a state of "doors closed", hanging signs for rent or for sale.

A row of deserted shophouses located next to An Phu metro station.

DKRA's Housing Market Report for Ho Chi Minh City and surrounding areas in the second quarter of 2025 shows that the shophouse segment has recorded movements, but is still full of challenges. Primary supply nationwide increased by about 16% compared to the same period last year, but 99% of the source came from inventory of previous projects. During the survey period, only 42 shophouses/resorts were traded - a very low rate compared to the total supply of more than 3,500 units.

According to DKRA, one of the reasons for the massive inventory of shophouses is the price. This type of premises often has a large area, is handed over in a rough condition, and has high finishing costs, forcing investors to invest a significant amount of capital before exploitation, while the rental profit margin is only about 2% - 3%/year, much lower than expectations as well as savings interest rates.

Mr. Vo Hong Thang, Deputy General Director of DKRA Group, commented that the projects are mainly distributed in the South and East of Ho Chi Minh City (old) with primary selling prices constantly remaining high. Typically, in the new subdivisions of some large urban projects in the East, the primary selling price is recorded to exceed 300 - 350 million VND per square meter of commercial floor, more than 3 times higher than the price of apartments being offered in the same project. The current rental price of shophouses in the base block is also recorded at a high level, ranging from 10 - 70 million VND, corresponding to a rental profit margin of only about 2% - 3%/year. "I think these are the main barriers that directly affect the absorption rate of shophouse products in the past and in the near future," said Mr. Thang.

DKRA's real estate investment experts also pointed out other reasons why shophouses in apartment buildings are "unsold" such as unfavorable locations, supply not meeting demand, large designs and areas that make prices higher but do not meet the needs of small businesses. The unit's survey shows that 70-80% of shophouse revenue comes from residents in the project, and if the apartment occupancy rate is not high, business will be even more difficult.

Legal factors are also a significant barrier. Many projects only have a 50-year term, leading to tenants' apprehension about having to pay high initial investment costs without long-term guarantees.

The notable point of the shophouse apartment line in the past 3-6 months, according to broker D.T, is that the price has remained stable, despite the apartment market going through a wave of administrative mergers. "The apartments that are being traded or are of interest are in projects with good legal status, which can be used for business or for immediate rent," said Mr. T.

Observers assess that shophouse liquidity is still an important "bottleneck", and requires strong participation from investors in reducing risks for buyers to stimulate demand in the short term.

According to Ms. Tran Pham Phuong Quyen, Manager of Savills Retail Leasing Department, shophouse podiums are facing strong competition from commercial center premises and residential rentals. To stimulate the consumption of this product line, investors should consider the commercial podium as a part that needs to be prioritized for filling, creating more favorable conditions to attract groups of tenants with large area needs or essential industries. In addition, careful preparation of design right from the pre-construction stage also plays a very important role, aiming to ensure that the rental premises, when built, meet the requirements of potential tenants immediately.

DKRA representatives also suggested flexible subdivision from 30-70 m² to better suit the needs and financial capacity of small businesses. "In addition, with the coordination between investors in design - operation, the government in legal support - infrastructure, and the management board in commercial operation strategy, the liquidity of shophouses on the base block can be completely improved instead of being left empty or forced to transfer at low prices as at present," said Mr. Vo Hong Thang of DKRA.

Source: https://vtv.vn/ly-do-shophouse-o-tp-ho-chi-minh-ton-kho-keo-dai-100250927154524129.htm