HCMC – Home prices in Vietnam are estimated at 20-26 times average annual income, putting homeownership out of reach for many and driving demand for rental housing.
According to the Urban Land Institute’s (ULI) Asia Pacific 2025 Home Attainability Index, housing prices in Vietnam are currently about 20-26 times higher than average annual incomes, placing the country among the least affordable housing markets in the region.
At the same time, rising living expenses, rental costs and other essential expenditures have made it difficult for many young workers to save enough for a down payment.
The Vietnam Institute for Real Estate Market Research and Evaluation (VARS IRE) said the rental housing market in Hanoi has recently shown signs of recovery in several areas.
However, the trend reflects more than just a rebound in the boarding-house segment. It also highlights growing demand for housing products that are aligned with people’s income levels.
In the past, rental demand was concentrated mainly among students, especially before the start of a new academic year. Today, the tenant base has expanded to include young professionals, middle-income workers and young families who are unable to purchase homes as property prices continue to rise rapidly.
Beyond natural demand driven by urbanization, infrastructure projects and urban redevelopment efforts are also adding pressure to the rental market.
According to the Hanoi People’s Committee, the city is currently carrying out land clearance for approximately 1,428 projects, including major developments such as the Hoang Cau-Voi Phuc section of Beltway No. 1, Tu Lien Bridge and Tran Hung Dao Bridge.
While waiting for permanent housing arrangements, some affected residents are seeking rental accommodation to maintain their jobs, their children’s schooling and their daily routines.
VARS IRE said the market’s core challenge is the shortage of so-called “starter homes” – housing options that allow people to secure stable accommodation before progressing toward homeownership.
In previous years, small apartments, reasonably priced condominiums and homes in suburban areas served as stepping stones for many families to accumulate assets. However, the supply of such products has become increasingly limited due to rising land prices, construction costs and project development expenses.
Data from VARS IRE showed that since the third quarter of 2024, many newly launched commercial apartment projects in Hanoi have been priced from around VND60 million per square meter, turning homeownership into a major financial challenge for many young buyers.
Against this backdrop, VARS IRE said Vietnam should develop a professional rental housing ecosystem alongside social housing and affordable commercial housing. Rental housing not only addresses immediate accommodation needs but also helps stabilize the workforce and support urban development.
To promote the segment, the research institute recommended policies on land allocation, financing, urban planning and support mechanisms for developers participating in rental housing projects.
A stable rental housing market would provide young people with additional housing options, ease financial pressure and give them more time to prepare for homeownership in the future.
