Several key construction materials have seen a sharp price hike during the first three months of 2022, putting significant pressure on property prices, according to the Vietnam Association of Construction Contractors (VACC).

VACC said prices for concrete and sand have increased by 100,000 VND (4.4 USD) per tonne or per cubic metre, bricks by up to 10 percent and decorative tiles by 10-15 percent.

Notably, since the beginning of the year, steel prices have increased to over 19 million VND per tonne after seven price hikes. 

VACC President Nguyen Quoc Hiep said rampant price hikes had hit contractors the hardest as they could no longer maintain a profit margin as input prices increased. 

"I'm not confident that most contractors can hold out for much longer. There have been many who were forced to exit the market as prices kept rising while investors kept delaying payment," said Hiep. "I've seen contractors going into the red because they didn't receive their payments in time due to their overwhelming financial obligations." 

Hiep said the average construction price for low-rise buildings had increased by 50 percent. By his estimation, newly signed contracts must readjust construction costs by a 20-25 percent increase. 

Nguyen Thi Thanh Huong, Director General of Dai Phuc Land SJC, said rising petrol prices were another factor that has driven prices up for contractors since the beginning of 2022. However, it's difficult to predict how much impact it will have on property prices. 

Huong said the rising costs would likely hurt property developers, especially those who failed to sign long-term contracts with suppliers and contractors. She said developers might be forced to increase their prices sometime in the second or third quarter this year. 

In a recent report, the Ministry of Construction said construction material prices are likely to keep going up in line with the global trend in the near future. The ministry said while supply remained ample for current demand, the rising cost has forced suppliers to increase their prices. The report said Vietnam's total concrete output stayed at over 106 million tonnes per year and could hit over 122 million tonnes if needed./.