Risk of housing oversupply

Easing Supply Pressure

A Malaysian developer recently announced plans to launch a new phase of its Eaton Park project with about 700 apartments, priced between VND 180–200 million per square meter. Covering a land area of 3.77 hectares, the project is designed with six towers ranging from 29 to 39 floors, supplying 2,052 units to the market, including nearly 2,000 luxury apartments, with a total estimated development value of more than USD 1.1 billion.

In early August, Van Phuc Group broke ground on the Diamond Sky complex on National Highway 13, adjacent to Metro Line 3B. The project will add around 296 high-end apartments, with expected prices at VND 130 million per square meter. Diamond Sky is the first high-rise subdivision within Van Phuc City, one of Ho Chi Minh City’s largest riverside townships spanning 198 hectares and planned for a population of more than 45,000 residents.

Nguyen Hoai An, Senior Director at CBRE Vietnam’s Hanoi office, noted that the second half of 2025 will be a “busy” period for the market as multiple projects launch simultaneously, especially in the northern and eastern areas of Hanoi. Strong momentum is being driven by the upcoming construction of new Red River bridges—Tu Lien, Tran Hung Dao, and Ngoc Hoi—along with the resolution of legal hurdles that had frozen many projects. “New supply in Hanoi in the second half of this year will grow significantly, bringing the total annual supply to around 31,000 units, on par with or exceeding 2024,” An said.

Meanwhile, in Ho Chi Minh City, consultancy Knight Frank Vietnam forecasts between 6,000 and 8,000 new apartments will be launched by year-end, nearly 5,000 of which will fall into the premium and super-luxury segments.

Path Toward Sustainable Development

Cao Thi Thanh Huong, Head of Research at Savills Ho Chi Minh City, warned that the rush by developers to roll out large projects risks flooding the market with supply all at once, creating the danger of “oversaturation” in housing. This is especially concerning as products within integrated townships typically command high prices that are less affordable for the broader market.

Some property experts also worry that if supply continues to rise while prices remain elevated, liquidity could weaken, particularly among younger buyers. Without an appropriate development strategy, the market could swing rapidly from undersupply to oversupply on a large scale.

Moreover, not every large-scale township ensures quality or stable liquidity. In recent years, several massive projects have been completed but poorly planned, leaving them deserted and underutilized, resulting in wasted resources.

From now until the end of 2025, the sales race is expected to intensify, especially in suburban areas and provinces benefitting from new infrastructure. This surge signals both renewed market confidence and questions about the sustainability of buyer demand. In such a competitive environment, flexibility in sales policies and a long-term strategic vision will remain critical for both developers and buyers to secure safe outcomes.

Economist Nguyen Minh Phong emphasized that the real estate market’s recovery and sustainable growth depend on multiple factors, including the pace of infrastructure development, access to credit for both developers and homebuyers, and timely policy adjustments by the government. When these elements converge, the market can not only thrive in the short term but also build a solid foundation for long-term growth.

According to Phong, the government must act as a “conductor” of the property market. Policies should be flexible enough to resolve immediate bottlenecks, while remaining steadfast in pursuing sustainable development goals. If tools related to credit, infrastructure, planning, and supply-demand balance are orchestrated effectively, the market will operate more stably and healthily. “The crucial task is to foster confidence among businesses and citizens, thereby transforming real estate into a positive and sustainable driver of the economy,” Phong stressed.