New home costs beyond reach of Hochiminions

22 Jun
Houses and apartments in Ho Chi Minh City have become so expensive that people must scrimp and save for ten years to afford them, according to Saigon Tiep Thi newspaper.


Nguyen Hoang Hai is a communication worker for a foreign company in HCM City. Though the young native of Ben Tre earns seven million dong a month, he can’t yet afford to buy a house for himself in the southern metropolis.

Hai can save two million dong a month ($105) after covering his basic needs, but an apartment costs nearly one billion dong ($19,000). Hai calculates that after 10 years, if he does not have to spend money on healthcare, does not get married, gets promoted every year, and apartment prices don’t change, he can buy a home.

Tran Hung, 31, relates that he and his wife live in a rented flat because he cannot buy one. The couple has savings of 300 million dong and have dreamed of having an apartment of his own. However, the cheapest apartment that Hung’s been shown, a 22 square meter flat in Binh Tan district, was priced at 500 million dong. For now, Hung and his wife have decided to rent an apartment for three million dong a month.

Hung learned that the apartments with an area of up to 100 square metre now are being offered at 16-17 million dong per square metre. “At such prices, owing an apartment is just a dream for us,” Hung said

Director Tran Quang Tuan of Minh Khoa Construction Company says those who have just graduated from university don’t have incomes sufficient to buy houses or apartments in big cities. Most new graduates earn three to four million dong a month, but apartments are priced from 600 million to 1.5 billion dong.

Even people who have a monthly income of five to ten million dong, still find it difficult to buy houses. Few are able to borrow, because the banks set high ‘free cash’ requirements on those who seek to finance purchase of a house or apartment. After the banks deduct the cost of meals, electricity and water, internet service, money sent ‘home’ to parents and income tax, few can qualify.

Yearly per capita income in HCM City in 2009 was over 40 million dong ($2100), or more than twice the national average. According to the Ministry of Construction, a 50 square metre low cost apartment now costs between 500-600 million dong. This means that only people with average income who abstains from eating or drinking for 10 years can save enough to buy a home in HCM City.

Many apartment projects in the city’s suburbs are introduced as ‘having soft prices’. However, even these ‘low cost apartments’ typically bear prices in the ten to fifteen million dong per square metre range. At the Le Thanh project apartments in Binh Tan district, for example, prices are set at ten to eleven million dong per square metre. ‘E-Home’ project flats in district 9 are offered at 11.8 million dong per square metre.

Source: Saigon Tiep Thi

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