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When will the cash flow return to real estate?

VTC NewsVTC News31/05/2023

Mr. Phan Vi, a real estate broker in the Southern region, said that despite the gloomy market, the demand for real estate suitable for real estate needs, business... is always there. However, demand is currently affected by the general market psychology.

Therefore, investors are still interested in investing in real estate, but their cash flow fluctuates in different channels such as stocks, bitcoin, banks, etc. "There are even customers who are about to close the house, but lost in stocks, so the transaction has not taken place," he said.

Conditions for market recovery

In fact, according to a report by the Vietnam Association of Realtors (VARS), in 2022 alone, the total amount of deposits from organizations and individuals in the banking system increased by nearly VND 900,000 billion . Notably, the amount of deposits in the fourth quarter of 2022 - the time when the real estate market fluctuated - accounted for 46% of the whole year.

Therefore, Dr. Pham Anh Khoi, Dat Xanh Services Economic - Financial - Real Estate Research Institute (FERI), a member of the VARS Market Research Working Group, believes that the third quarter of 2023 will be a key time when a large amount of bank deposits mature.

"This is also the decisive moment for whether cash flow will return to the real estate market or not," he said.

Although interest rates have cooled down and credit room has opened, cash flow has not really returned to the real estate market.

Accordingly, this person gave two possible scenarios. With the first scenario, if the real estate market situation is still difficult and investor confidence has not been restored, this source of money may continue to stay in the banking system, accepting a lower interest rate.

"In the second scenario, if the market warms up, deposit interest rates drop to 6-7% by the end of this year or even do not decrease, then the money source will likely prioritize returning to the real estate market," he said.

To date, VARS believes that the period of tightening monetary policy is showing signs of slowing down. "It is forecasted that by the end of the second quarter of 2023, the period of tightening monetary policy will likely end," the unit emphasized.

In fact, after two rounds of interest rate reductions by the State Bank of Vietnam, there are now signs of money returning. Bond interest rates, interbank interest rates, and deposit interest rates have cooled down, and customers have been able to access new loans with interest rates of 10-11%.

However, VARS emphasized that the real estate market will only react when the average interest rate drops below 10%, because 10% is the number that investors can afford to borrow.

Time to put down money?

However, experts at VARS believe that this is the right time for investors to research and decide to invest. Because the real estate market in the first quarter of 2023 has shown signs of positive change thanks to the Government 's support and difficulty removal measures.

In fact, VARS's records in regions across the country show that since the middle of the second quarter of 2023, investors have begun to hunt for fertile lands with great development potential. Some regions have shown clear signs of improvement with an increasing number of successful transactions.

Similarly, Mr. Dinh Minh Tuan, Director of Batdongsan in the Southern region, also commented that the most difficult time of the real estate market has passed.

"According to the data we have, since the first week of May, the supply and interest in searching for real estate have shown more positive signs," he said.

However, Mr. Nguyen Quoc Anh, Deputy General Director of Batdongsan, still recommends that investors should carefully consider financial problems, consider their own capital, borrowing capacity and debt repayment capacity.

“For those who buy to live, buying a house at this time will immediately meet their needs and settling down can help homeowners have better cash flow.

As for investors, they should calculate much more carefully because investment costs are related to capital recovery, so they need to grasp detailed information about the possibility of fluctuations in rental prices, selling prices, and rental yields," Mr. Quoc Anh analyzed.

(Source: Zing News)

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