Ho Chi Minh City has 474 apartment buildings constructed before 1975, of which 355 have site areas of less than 1,000 sq m. Many of these buildings are scattered across inner-city areas where infrastructure is already under significant pressure. Although the 2023 Housing Law and Decree No. 98/2024/ND-CP have strengthened the legal framework for apartment renovation and reconstruction, redevelopment progress still depends on investment feasibility, the resolution of planning issues, and consensus among residents.
Table of Contents
1. What is the current status of old apartment renovation in Ho Chi Minh City toward 2035?
Ho Chi Minh City’s program for renovating and reconstructing old apartment buildings is being implemented toward the 2035 target, with a focus on ensuring building safety and improving the efficiency of land use in inner-city areas. This process requires coordination among legal reforms, administrative decentralization, and efforts to address the deterioration of existing buildings.
Most old apartment buildings were constructed either before 1975 or during the 1975–1994 period. After decades of use, inadequate maintenance, unauthorized alterations, and encroachment may increase risks to structural integrity, technical systems, and fire prevention and firefighting (PCCC) requirements. Some buildings have deteriorated seriously and require residents to be relocated and the buildings reconstructed to ensure safety.
The paradox is that although many of these apartment buildings are located in central areas such as District 1, District 3, District 4, and District 5, where commercial land values are high, attracting private investment remains challenging. The main obstacles include planning procedures, the difficulty of arranging resettlement on small land plots, and negotiations with residents over compensation.
2. What data reflects the scale and challenges of redevelopment?
The following figures illustrate the scale of the renovation program and the factors that directly affect project investment plans.
Indicator | Recorded data | Implications for project development |
Pre-1975 housing stock | 474 apartment buildings, concentrated particularly in District 5, with 206 buildings. | A potential source of inner-city land for redevelopment, but highly fragmented. |
Building characteristics & site size | 467/474 apartment buildings are 8 stories or lower; 355/474 have site areas of less than 1,000 sq m. | A major constraint on building density, setbacks, and profit margins when developing architectural plans. |
1975–1994 apartment buildings | Located across Districts 1, 3, 4, 5, 7, 10, and 11, Tan Binh, Tan Phu, Binh Thanh, and Thu Duc City. Of these, 52 are below 8 stories and 33 have site areas of less than 1,000 sq m. | Complex ownership structures involving multiple government agencies and households. |
Dangerous buildings – Grade D | 16 buildings involving 1,194 households. A total of 684 households have been relocated: relocation has been completed at 9 buildings (534 households), with 7 buildings demolished; 3 buildings are partially relocated (150/386 households); 4 buildings have not yet been relocated. | Site clearance and reconstruction remain significantly delayed compared with the urgency of the situation. |
Resettlement floor-area ratio | New resettlement apartments must have a minimum floor area equivalent to 1–2 times the area of the former apartment for ground-floor units, and 1–1.5 times for units from the second floor upward. | Directly increases the amount of gross floor area (GFA) that must be returned to residents, reducing the commercial floor area available to the developer. |
2025–2035 targets | In 2025: develop implementation plans for 31 projects. By 2030: complete investment preparation for pre-1975 and 1975–1994 buildings and complete reconstruction of 16 Grade D buildings. By 2035: complete the renovation and reconstruction of all pre-1975 buildings and Grade D/expired-service-life buildings from the 1975–1994 period. | Establishes a long-term regulatory timeline that allows businesses to plan project cash-flow cycles. |
These figures show that the stock of buildings requiring renovation is large but highly fragmented. In particular, small land plots make it difficult to arrange resettlement, meet planning requirements, and generate sufficient commercial floor area to recover investment costs.
3. How have the legal and project-management mechanisms changed?
Compared with the 2016–2020 period, when Ho Chi Minh City completed repairs on 132 out of 474 apartment buildings, equivalent to approximately 29%, the approach during 2025–2026 focuses more strongly on investment preparation and resolving implementation bottlenecks.
Strengthening the legal framework: The 2023 Housing Law and Decree No. 98/2024/ND-CP establish procedures for renovating and reconstructing apartment buildings, compensation and resettlement mechanisms, and investor selection. This provides an important legal basis for addressing cases involving state-owned areas and issues related to the rights and interests of different stakeholders.
Increasing the role of the state budget: Ho Chi Minh City plans to use public funds for investment-preparation activities such as structural inspections, preparation of detailed 1:500-scale plans, and development of renovation plans for apartment buildings without investors. This approach could reduce part of the initial costs and risks for private developers.
Strengthening administrative decentralization: The city is moving toward delegating authority to local-level agencies to prepare, appraise, and approve detailed plans within their respective jurisdictions, while coordinating the resolution of project-specific issues. The objective is to shorten administrative processing times and increase implementation flexibility.
Considering additional incentives: In addition to existing support mechanisms, Ho Chi Minh City is moving toward developing local policies to enhance the attractiveness of these projects to investors and support residents participating in the program.
Nevertheless, the effectiveness of these changes will depend on implementation. Each project still needs to be assessed individually in terms of planning, ownership structure, resettlement arrangements, and financial feasibility.
4. What challenges must developers address to ensure investment feasibility?
Renovating old apartment buildings involves a more complex investment structure than developing a greenfield project. Developers must address planning, financing, site clearance, and market absorption simultaneously.
Planning and land-use efficiency: Investor-attraction mechanisms may include exemptions from land-use fees and consideration of increased planning and architectural parameters, subject to applicable regulations. However, projects in inner-city areas must comply with requirements relating to infrastructure, building density, height, and population. With 74.8% of pre-1975 apartment buildings having site areas of less than 1,000 sq m, stand-alone redevelopment projects may struggle to balance resettlement obligations with commercially viable floor area.
Cost structure and financing: Developers must prepare funding for compensation, resettlement, temporary accommodation, and construction. If site clearance or legal procedures are prolonged, interest expenses, management costs, and other additional costs will increase, putting pressure on the internal rate of return (IRR). Previously recorded temporary housing support has ranged from VND 5 million to VND 15 million per household per month, depending on the number of household members, although the applicable level must be determined according to the policy in each specific case.
Legal issues and site clearance: Ownership complications, inheritance disputes, informal transfers, and differing expectations regarding compensation can prolong relocation. For households occupying small apartments, compensation may not be sufficient to purchase a new home in the city center. Meanwhile, moving to a more distant resettlement area may affect employment, education, and daily life.
Demand and market absorption: Locations in central areas such as District 1, District 3, District 4, District 5, and Binh Thanh offer advantages in terms of end-user demand and rental potential. However, location value can translate into investment efficiency only when the planning, product strategy, and resettlement obligations are financially viable. Options for receiving an apartment or cash must be implemented in accordance with applicable regulations and approved plans.
5. What bottlenecks are determining the pace of old apartment redevelopment?
5.1. Relocation and demolition do not necessarily mean reconstruction can begin
Even after residents have been relocated and a building has been demolished, a project may still be stalled by planning procedures, investment appraisal, or schedule adjustments.
At Thanh Da Residential Complex, Blocks IV and VI have been demolished, but reconstruction has encountered obstacles. Similarly, the project at 239 Cach Mang Thang Tam Street has been cited in reports concerning procedural difficulties, despite the developer having proactively negotiated with residents.
These cases show that project progress depends not only on site clearance but also on coordination between planning and investment procedures.
Sources: Ho Chi Minh City Press Center, Vietnam Public Procurement Review.
5.2. Sites of less than 1,000 sq m limit investment efficiency
With 355 out of 474 pre-1975 apartment buildings and 33 buildings from the 1975–1994 period having site areas of less than 1,000 sq m, stand-alone redevelopment models face significant limitations. Developers must balance resettlement floor area, setbacks, building density, and the commercially usable area.
Under plans reported by the media, the floor area of resettlement apartments may be determined based on a ratio to the original apartment, depending on the floor on which the unit was located. This obligation increases the amount of floor area that must be returned to residents, while the ability to increase building scale remains subject to planning regulations.
Therefore, studying redevelopment by clusters or consolidating adjacent land plots could be an approach worth considering, provided that it is consistent with planning requirements and actual site conditions.
Sources: Tien Phong, Znews.
5.3. Building safety and fire prevention requirements create pressure for early intervention
Seriously deteriorated apartment buildings require urgent action to relocate residents and ensure safety. However, implementation must simultaneously address residents’ rights and comply with legal procedures.
The Vinh Hoi apartment building in District 4 illustrates how resident relocation efforts can be prolonged even after a building has been classified as dangerous through a structural assessment. Authorities therefore need to combine safety assessments, communication, dialogue, and legally prescribed measures in cases of non-compliance.
Sources: Ho Chi Minh City Press Center, Tuoi Tre.
5.4. The state is taking a greater role in the investment-preparation stage
Previously, developers faced substantial upfront costs and prolonged risks when independently undertaking many project-preparation activities while simultaneously negotiating with households.
The city’s plan to use public funds for structural inspections, planning, and the preparation of renovation programs could reduce some of the risks before investors are selected. If planning documents and project information are prepared clearly, developers will have a stronger basis for assessing investment feasibility.
However, this approach does not eliminate financial, compensation, or procedural risks during the implementation stage.
Sources: VietnamFinance, CafeLand.
6. What trends will shape the old apartment redevelopment market from 2025 to 2035?
From 2025 to 2035, the market may be shaped by three major development trends:
Greater emphasis on cluster-based planning: Given the large number of small apartment sites, redevelopment by clusters or urban blocks could improve spatial organization and resettlement capacity. Developers with strong master-planning capabilities are likely to have an advantage in suitable projects.
Greater emphasis on financial capacity: Because developers must finance compensation, temporary accommodation, and construction before they can monetize commercial floor area, they need sufficient long-term capital and disciplined cash-flow planning. Strong financial capacity will therefore be an important factor in investor selection.
More professional legal and community management: Reviewing ownership records, maintaining transparency in compensation plans, and engaging with residents from an early stage could reduce disputes and minimize delays. Mergers and acquisitions (M&A) involving old apartment assets should also be assessed based on legal status and actual implementation feasibility.
CONCLUSION
Renovating the 474 apartment buildings constructed before 1975, together with buildings from the 1975–1994 period, is an important component of Ho Chi Minh City’s urban redevelopment strategy. Although the 2023 Housing Law and Decree No. 98/2024/ND-CP have strengthened the legal framework, progress remains affected by site size, planning parameters, resettlement costs, investment procedures, and resident consensus.
To achieve the 2035 target, the city needs to continue improving planning, preparing projects, and coordinating the resolution of residents’ rights and interests. For developers, the ability to structure financing, manage legal risks, and develop feasible resettlement plans will determine the long-term sustainability of old apartment renovation projects.
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