Some experts are concerned that higher land prices could push up housing prices, reducing access to housing for people with real demand.

The Hanoi Department of Agriculture and Environment is drafting a new land price list to be submitted to the city’s People’s Committee for approval, scheduled to take effect on January 1, 2026.

Under the draft, the highest land prices are set for streets in the former Hoan Kiem District, exceeding VND700 million per sqm. The sharpest increases, 16-26 percent, are proposed for suburban areas.

The drafting agency explained that the new land price list aims to reflect market values better, narrow the gap between state-regulated and actual transaction prices, and boost state revenue through higher land-related financial obligations from organizations and individuals.

Vu Cuong Quyet, General Director of Dat Xanh Mien Bac, said that if approved, the new price list, effective from early next year and valid for several years, will serve as a key basis for compensation and site clearance.

According to Quyet, the new price list should be built based on real market conditions, considering all relevant factors to ensure accuracy. If land prices are set too much below market levels, it will lead to significant state budget losses.

When land prices are adjusted closer to reality, market selling prices will inevitably rise. However, transparent prices that reflect true value can accelerate supply for the market, making land transactions and decision-making more convenient.

“Land costs account for only about 25-30 percent of a developer’s total expenses. Therefore, if the official price list increases, businesses will have to thoroughly consider their selling prices accordingly, which can positively affect the real estate market,” he added.

He went on to emphasize that when market prices in Hanoi are already very high, with many apartment projects priced between VND70 million and over VND100 million per sqm, and suburban land lots ranging from VND50 million to VND80 million per sqm, the proposed increase in the land price list is not worrying.

“When market prices are high but the official land price list remains low, it results in lost tax revenue. Who will be responsible for that?” Quyet said.

The Vietnam Real Estate Association (VNREA) believes that improving the legal framework on land and ensuring transparency to reflect the true value of land use rights is essential. However, any adjustment to the land price list must be made cautiously to balance the interests of the state, businesses, and citizens.

VNREA has proposed that the Hanoi People’s Committee amend several aspects of how land prices are determined.

According to the association, the real estate sector and related industries contribute around 10 percent of GDP, playing a key role in economic growth, job creation, and state revenue.

In the context of the Government setting a double-digit growth target from 2026 while Hanoi alone strives for average GRDP 11 percent/year in 2026-2030, a land price table increase may raise investment costs and affect project implementation and economic competitiveness, VNREA said.

“Chain consequences from a land price increase may cause the real estate market to stagnate, leading to a negative impact on fields like construction, materials, and finance-banking, thereby affecting growth targets and macro stability. Conversely, reasonable land price determination will contribute to GRDP growth,” VNREA stated.

Land price determination needs to aim at enhancing land access and production-business premises, and controlling land price fluctuations, especially non-agricultural production-business land prices because of impact on enterprise investment and production-business plans, and city economic development.

VNREA warned that land price increases according to new land price table will lead to high housing cost increase, reducing investment attractiveness, especially the investment in real estate projects in suburban areas.

This will affect city housing development plans in suburban areas for population dispersion purposes. Housing supply on the market will continue to decrease, causing difficulties in stabilizing social security.

Conversely, suitable land prices and input costs will contribute to reducing real estate prices, including housing. Land price increase will impact costs, thereby affecting real demanders' housing access opportunities. For commercial housing, if land prices increase, this will affect project feasibility, causing housing prices to continue rising.

“The real estate market is in recovery, many enterprises have to restructure, and capital flow still limited. Therefore, a land price increase at this time may create an additional 'double burden' slowing market recovery momentum,” VNREA said.

Hong Khanh