Many landlords are planning to increase rent after Tet in Viet Nam越南文

"We still have to wait to see what the customer decides. In the worst case, the customer will return the house, and we will have to spend extra money to find a new customer," Ms. Linh said. Although price increases are inevitable, landlords are worried that current tenants will leave because of sudden price increases, and landlords will have to spend more money to find new tenants.

As for Ms. Xuan, the owner of a private house on Nguyen Thi Nho Street, District 10, she also plans to increase the rent from 9.5 million VND to 11 million VND per month in early January. It's been 3 years, she hasn't increased the rent so she hopes the customer will accept. She thinks that this is not a high rent, nor is it an unreasonable increase because it has been kept stable for the past few years. Not to mention, with the current level of inflation, rising prices, increasing rent is an unavoidable task to balance family income.

"Everyone is worried about losing customers, but renting a house is the main source of income, so raising prices is mandatory," Ms. Xuan said.

Great pressure from tenants when house prices increase

Mr. Phuoc Hoa, owner of a leather shoe store on Le Dai Hanh Street, District 11, was nervous when the landlord announced a rent increase of 15% (about 4 million VND a month) after Tet. His store is still doing steady business, not to the point of being sluggish but not as good as a few years ago. Carrying an extra few million every month will make it difficult for small businesses like him.

"I'm negotiating with the landlord to see if we can lower it a bit because we don't know if the economy will improve this year. Moving the premises requires having to redo many things, and the cost is not cheap," Mr. Hoa said.

Also receiving a notice to increase the rent by 1 million from March this year, Mr. Quan (IT engineer, District 7) negotiated with the landlord to keep the price until the middle of this year or increase it slightly. He himself also asked the residential group to see if there was a smaller apartment with a reasonable rent so that if he couldn't negotiate, he could move out.

"This year's economy is difficult, so hopefully the landlord can maintain the rent until 2024, if not, he will have to consider returning the house," Mr. Quan added.

Regarding rental prices, apartment prices in inner-city districts saw little change last year, with suburban areas recording a decrease of 5-10% in some projects.

According to records from Batdongsan site, by the end of 2023, almost all types of rental searches will decrease such as: apartments down 24%, private houses down 30%, motels down 32%, shops, kiosks down 31% compared to February 2023. However, real estate rental prices still increased by 6% over the past year.

Rents increase but rental demand will not decrease

Explaining the trend of increasing house rent prices , Mr. Dinh Minh Tuan, Director of Batdongsan in the Southern region, said that the post-Tet cycle is often a period of escalating prices, not only house rent but also most essential goods. Consumers are watching this time to increase prices. This is also a period that many people easily accept because the rent adjustment after Tet has been imprinted in the psychology of many tenants and lessors.

In addition, the beginning of the year is the period when the business cycle is just starting, many new businesses tend to choose the beginning of the year to open offices and business stores. Rental demand will usually increase during this period, although the central townhouse segment may continue to struggle.

In addition, it is possible that after the government tightens the fire prevention and fighting regulations on the boarding house segment, new supply in the group providing for the majority of demand will also decrease. Boarding houses and motels that still ensure fire protection can increase prices to compensate, and demand will also increase after workers and students return to the city. On the other hand, landlords also want to increase prices to compensate for price slippage.

原文圖片：photo.rever.vn  

Mr. Tuan forecasts that in the first months of 2024, apartment rental prices in Ho Chi Minh City may increase by 4-6%, rental profit margins will also increase again to 4.9%. However, the increase will not be high because the landlord has to "make ends meet" and the tenant's strength if they do not want to lose customers.

According to Ms. Trinh Thi Kim Lien, Sales Director of Dat Xanh Services, in 2023, a shift in consumer behavior will be recorded, shifting from buying to renting a house in a context where the economy has not yet recovered. Housing supply is scarce, selling prices are high. This shift increases the demand for rental housing.

However, there is still a difference between the types of rental housing. The group of low-end housing and worker housing is quite empty and difficult to rent. The type of apartments for rent in the average segment and above maintains a good absorption rate. The closer a house is to the center, office areas, schools, and supermarkets, the more special attention it receives and the more affordable it is to rent.

"In the context of skyrocketing housing prices, the dream of buying a house for low-income people and workers is increasingly distant. Renting a house becomes the only choice, but if rent prices also increase, workers Having a low income increases the pressure," Ms. Lien shared.

For more information about real estate projects in Ho Chi Minh City and neighboring provinces, please contact FTT LAND!

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