The potential of senior housing market in Vietnam
As the country undergoes a demographic and lifestyle transition, it is essential to recognize the need for dedicated living space targeting senior citizens.
Despite the persistence of the traditional mindset, the senior housing market in Vietnam holds immense potential for growth, driven by and developments in both demand and supply.
Immense demand facilitated by demographic shift: Vietnam's demographic is transforming rapidly, with the proportion of the elderly population expected to increase significantly in the coming years. According to the General Statistics Office, the proportion of Vietnam’s elderly population (aged 60+) accounts for 13% of its population but is forecasted to reach 17% by 2030 and an alarming 25% by 2050. This demographic movement presents a massive market demand for senior housing models that cater to the special needs of the elderly population.
Rising income and changing lifestyle are additional growth factors: Vietnam has witnessed rapid economic growth, resulting in rising disposable income, especially among the middle class. As seniors become more financially independent and open-minded, they seek service-oriented living arrangements. This growing segment of the population is willing to invest in senior housing options that provide a fulfilling lifestyle through proper healthcare services, recreational amenities, and social engagements. Furthermore, access to quality healthcare is a primary consideration for both seniors and their families (Figure 1). Therefore, investing in senior living facilities that offer on-site medical facilities or close proximity to hospitals and clinics is a significant opportunity for investors in the market.
Figure 1: Level of interest in services of a senior house, Vietnam Senior Housing Survey, 2023
Note: Promoters = 9-10, Passives = 7-8, Detractors = 6 and below for 10 score evaluations
Limited quality supply: Senior housing in Vietnam primarily consists of nursing homes and a few assisted living facilities. In Ho Chi Minh City and its satellite provinces, there are only around 30 senior care establishments, most of which operate out of charity to support the homeless without families (Figure 2). In a growing market like Vietnam, where supply typically leads to demand, there is a great opportunity for first movers to introduce high-quality products into this market.
Figure 2: Types of senior housing supply in Ho Chi Minh City and surrounding provinces, Q1 2024
Source: JLL Vietnam Research
In recent years, however, there have been some signs of progress in Vietnam’s senior housing market. Local and international investors have started recognising the potential and are exploring opportunities to develop senior housing projects in Vietnam. As a real estate consultant, JLL has been receiving escalating inquiries relating to this market countrywide. However, while the senior housing market in Vietnam has strong potential, it does face varied obstacles. One of the main challenges is the traditional perception of care within families, where it is deeply expected for the elderly to be cared for by their children. Convincing caregivers and potential residents to consider senior housing as an alternative will require overcoming cultural barriers and changing mindsets.
To unlock the full potential of the senior housing market, it is essential to attract investments and promote awareness about the benefits and importance of specialised housing for seniors. To do this, developers can adopt strategies to educate potential customers and build trust by showcasing successful senior housing models and their positive impact on the well-being of seniors and their families. In addition, collaboration between the public and private sectors, as well as the involvement of experienced elderly care and healthcare operators, will play a crucial role in developing a robust senior housing market in Vietnam.
