For the past 2 months, third-year Le Minh Thu of Van Hien University has been struggling to find a new room. Previously, she and a classmate rented a room in an alley on Luy Ban Bich Street of Tan Phu District for their studies. Their initial room rental was priced at VND2.5 million (US$98.5) per month. By mid-May 2024, as their contract neared expiration, the landlord unexpectedly announced a price increase to VND2.8 million ($110) per month, along with a rise of the electricity rate from VND4,000 ($0.16) to VND4,500 ($0.18) per kilowatt-hour.
"We cannot comprehend why the monthly electricity bill for our room reaches nearly VND700,000 ($27.6), especially considering we are at university from early morning until late evening, and are absent on weekends as well. With such escalating accommodation costs, we have decided to seek a more affordable alternative to alleviate the financial burden on our families," Thu shared.
Thanh Ngoc, an office worker, recently moved from District 3 to Go Vap District due to soaring rental costs. Previously, she shared a floor of a four-story house on Le Van Sy Street for VND4.5 million ($177) monthly. With additional utility costs, this reaches a total of VND7 million ($276). When the landlord raised the rent to VND5 million ($197), she was forced to relocate to a more affordable neighborhood, highlighting the increasing financial burden on residents.
Rental property owner Huynh Thang from Hiep Binh Chanh Ward of Thu Duc City has managed 30 rental rooms for nearly a decade, charging VND2.5 million ($98.5) per room per month. Despite recent economic stabilization and rising market prices, he has only marginally increased rent by VND300,000 ($12) in September. However, he acknowledges the impact on tenants and continues to offer lower rates in challenging circumstances.
Industrial zones like Tan Thuan Export Processing Zone in District 7, Linh Trung Export Processing Zone in Thu Duc City, and Tan Tao Industrial Cluster in Binh Tan District once bustling with fully occupied rental accommodations, are now experiencing increased vacancy rates. Despite this, rental prices remain unchanged.
Meanwhile, real estate prices in the city have risen since mid-May 2024, especially near universities. Rental prices in these areas have increased by about 20 percent compared to the previous year, reaching around VND6 million ($236) per month.
Data from Cho Tot, a specialized real estate platform, confirms the rising rental market in HCMC. The rental room and serviced apartment segment has experienced rapid price increases during the third quarter of 2024, coinciding with the academic year's commencement. Remarkably, the minimum rental price has reached VND3 million ($118) per month—the highest in two years.
The primary reason for rental price increases in HCMC stems from continuously rising apartment and real estate purchase prices since early 2024, which have narrowed buyers’ options. Many residents have shifted towards rental solutions instead of purchasing, thereby increasing rental demand.
Additionally, property owners have been required to invest in fire prevention equipment to meet new legal standards, consequently driving rental prices upward.
Regional Director Dinh Minh Tuan of batdongsan.com.vn attributed the price surge to the university admission peak season, with increased student accommodation needs. Furthermore, with escalating real estate prices, young individuals are increasingly preferring long-term room rentals over property accumulation.
HCMC’s economy has recently faced challenges with rising rental prices despite economic difficulties and job losses. This paradox is attributed to two main factors. Firstly, real estate investors, burdened by a sluggish market and loan repayment pressures, are increasing rents to cover costs. Secondly, stricter fire safety regulations have led to the closure of some rental properties, further limiting supply and driving up prices.
Real estate expert Tran Khanh Quang
