In parts of Southeast Asia, unsold homes are piling up as developers struggle to clear housing stock – yet young buyers hoping to land their first property still cannot find an affordable home.

The paradox reflects a growing mismatch between the homes being built and what aspiring buyers can afford, according to analysts, who point to speculative investment, financing hurdles and poor locations as factors leaving properties empty even amid demand for affordable housing.

In Vietnam, the problem centres on what developers have built and the returns they expect, according to Nguyen Khac Giang, a visiting fellow at Singapore’s ISEAS – Yusof Ishak Institute. His research examines how the country’s increasing reliance on land to finance growth can favour property investment over the housing needs of new urban families.

The pressures take a different form in the Philippines, where investment-led condominium projects and low initial payment plans have left some buyers unable to complete their purchases.

In Malaysia, meanwhile, a substantial share of completed unsold homes falls within the price range conventionally described as “affordable”, raising a different question: why do these properties not meet the needs of the people who could buy them? Competing interests According to Vietnam’s construction ministry, the country’s reported property inventory reached about 51,950 units and land plots in the third quarter of 2026. This number covered 27 of 34 provincial-level localities and included housing and land, not just completed empty flats.

Meanwhile, flats priced at 70 million dong to 100 million dong (US$2,707 to US$3,867) per square metre accounted for about 48 per cent of third-quarter launches, according to the Vietnam Association of Realtors. Another 23 per cent cost between 100 million dong and 200 million dong.

Giang said local governments’ pursuit of land revenue and developers’ expectations of rising prices helped explain the imbalance. Higher land costs encouraged more expensive projects to recover the investment.

“During a boom, serving ordinary buyers becomes less attractive than betting on further appreciation,” he said.

A paper Giang published in August put land-related revenue at 575.5 trillion dong in 2025, or 21.7 per cent of state revenue. However, linking public finances and bank lending to property values left both vulnerable to falling prices, he warned.

“Cheaper land could improve affordability, but it would also weaken public revenues and the financing of infrastructure. The state therefore has competing objectives: affordable homes and valuable land.”Sharp price falls would also hurt developers and banks holding property-backed loans. Developers able to refinance or hold inventory faced less pressure to discount, Giang said.

“These pressures can delay a correction, although they cannot prevent one indefinitely.”His paper cited China as a warning about dependence on property-linked revenues and called for more transparent land allocation and investment of land-value gains in compensation and affordable housing.

For buyers, the shortage of homes within the reach of ordinary incomes made deposits and repayments daunting.

“Mortgage-rate uncertainty adds another barrier, because a buyer who can afford the introductory rate may struggle when it resets. Easier loan approval alone cannot fix that,” Giang said.

Low entry In the Philippines, the gap between entering the property market and sustaining home ownership is evident in the way some condominiums are sold, according to Joey Roi Bondoc, research director at Colliers Philippines.

Developers marketed instalments as little more than a buyer’s monthly “Starbucks budget”, Bondoc said, meaning buyers could spread a small down payment across several years while the building was under construction.

For example, Bondoc calculated that the 10 per cent down payment on a 7-million peso (US$109,560) flat could be spread over 60 months. But once the unit was completed, the buyer would need to finance the much larger outstanding balance through a bank loan.

Monthly payments could then triple or quadruple, he said, with some buyers unable to afford the difference or obtain loan approval.

The problem was compounded by the influx, then retreat, of Philippine offshore gaming operators (Pogos), whose workers had supplied rental demand during the condominium boom. Investors had expected that income to help cover their payments, Bondoc said.

Bondoc noted that speculative demand peaked between 2017 and 2019, when developers were completing almost 14,000 condominium units annually. From 2027 to 2029, he said he expected annual completions to range around 6,000 in response to weaker market conditions. Yet the unsold stock does not necessarily offer an accessible alternative for homebuyers.

Colliers’ data shows that more than 40 per cent of Metro Manila’s 32,600 unsold units fall within the company’s “lower-mid” price segment of between 3.6 million and 7 million pesos. But this is a market category, not a guarantee of affordability for an early-career worker.

Bondoc estimated that buyers considering homes in that segment should earn at least 70,000 pesos a month. That figure, however, is about 2.4 times more than the average monthly wage in Metro Manila of 29,310 pesos, according to the 2024 national wage survey.

For some workers, even renting near employment centres remains too expensive. Bondoc described employees commuting from Cavite, Bulacan and Laguna to Metro Manila, with journeys taking an hour or two because they could not afford accommodation nearer their jobs. Market mismatch Malaysia shows that unsold housing is not confined to expensive properties.

Recent data from Malaysia’s National Property Information Centre revealed that 33,094 completed residential units remained unsold in the first half of 2026, of which 37.3 per cent (12,340 units) were priced at 300,000 ringgit (US$73,400) or below.

Siva Shanker of Rahim & Co Chestertons, a property consultancy, said unsold homes could reflect the wrong product, location, price, or a combination of all three. In his experience, location was often the main problem.

Lower-priced homes built far from workplaces and schools could force households into unmanageable commutes, he said. “The person or household would rather not buy, they would just rent something nearby.”For younger buyers, Siva identified a separate obstacle: raising the cash needed even when monthly repayments appeared manageable.

Using a hypothetical 500,000 ringgit home financed with an 80 per cent loan, he said a buyer would need 100,000 ringgit for the deposit alone, before other upfront expenses such as conveyancing fees and stamp duty. Not to mention potentially another five-figure sum for home renovations.

“They may be able to afford the repayment” but lack the down payment, he said. Potential buyers might also postpone ownership to save for the down payment, only to find prices had increased. “They end up chasing forever,” he said.

In Malaysia’s recent Budget 2027 reading, the government announced measures to help first-time buyers, such as 20 billion ringgit in financing guarantees through the state-managed Housing Credit Guarantee Scheme targeting up to 80,000 first-timers, particularly the self-employed without fixed incomes.

Prime Minister Anwar Ibrahim also proposed full stamp duty exemptions on transfer documents and loan agreements for first homes costing up to 500,000 ringgit, covering purchase agreements signed between January 2027 and December 2030.

Similarly in Vietnam, the construction ministry proposed in April to promote lower-cost commercial housing and accelerate a 145 trillion dong credit programme for social and worker housing, including support for buyers under 35.

But financing support alone would not resolve the price-income gap, Giang said.

“Even a sizeable discount on an expensive flat can’t help much for young first-home buyers.”