The average rent for serviced apartments in HCMC has fallen to a five-year low as the Covid-19 pandemic stifles demand. The $23 per square meter per month price tag in the third quarter marks a 10 percent year-on-year fall, according to data compiled by real estate consultancy Savills.
Occupancy fell 19 percentage points to 65 percent as there were few international flights entering the country. Foreign businesspeople and experts are the main tenants of serviced apartments.
In the first nine months, registered foreign direct investment capital in HCMC dropped 28 percent year-on-year to over $3 billion.
Owners of over 20 percent of Grade B projects are offering discounts of up to 30 percent for long-term tenants or other perks like free utilities.
The supply of serviced apartments fell 7 percent year-on-year to 6,200 units, with one Grade B project withdrawing 164 units for renovation and a 31-unit Grade C project being converted into office space.
Eleven projects are expected to boost supply by another 1,300 units in the next four years.