Loan interest rates are down, should I borrow money from the bank to invest in real estate?

Mr. Quoc Tuan, an investor in Hanoi, has more than 1 billion VND in savings in the bank.

Observing the market, Mr. Tuan saw that the lending interest rates at many banks have decreased compared to the previous period. Some banks are lending to buy real estate with an interest rate of just over 8%/year.

“Real estate prices in many places are cooling down, cutting losses. Interest rates are decreasing, with the available money, should I borrow more money from the bank to invest in real estate? Borrow now or wait for interest rates to decrease further?”, Mr. Tuan wondered.

Not only Mr. Tuan, many investors with small capital also have the same question at this time.

According to experts, the fourth quarter of 2023 will be the "golden" time to borrow to invest in real estate. (Photo: Hoang Ha)

Sharing with VietNamNet reporter, Mr. Do Quy Duy, Executive Director of NAC Real Estate Investor Club, said that depending on the amount of cash available to investors, if there is a lot of money, structuring about 20-30% of the available amount into investment and only borrowing from the bank less than 20%, then it is possible to enter the market at this time.

However, according to Mr. Duy, the market trend is not clear. If investing this year, next year the market is likely to remain flat or decrease slightly. “For most people with a moderate amount of money, they should wait a little longer,” Mr. Duy stated his opinion.

Meanwhile, according to Mr. Nguyen Anh Que, Chairman of G6 Group, Member of the Executive Committee of the Vietnam Real Estate Association (VNREA), it is predicted that by October this year, real estate will "warm up" again and be relatively vibrant from April 2024 onwards. At the same time, interest rates at that time will also be lower than now.

Mr. Que said that there will be fixed loan packages of about 7.5 - 8.5%/year.

“The fourth quarter of 2023 will be the “golden” time to borrow for investment because of low interest rates and low real estate prices. Especially when the State is always looking for ways to restore the real estate market and the economy ,” Mr. Que predicted.

The leader added that during the difficult years due to the Covid-19 pandemic or the difficult time of the real estate market, he did not borrow from the bank. However, this October, Mr. Que plans to borrow capital because he believes that this is an opportunity to invest in real estate in potential markets.

Commenting further on the recovering segments, Mr. Do Quy Duy assessed that from now until the end of the year, the high-end segment for the rich will recover first.

Meanwhile, the mid-range and low-cost segments have not recovered due to lack of supply and will have to wait until next year. In addition, land prices have not changed this year.

Observing recent market movements, Mr. Duy suggested that cheap inner-city street-front buildings, mini apartments, and “beauty queen” products in metropolitan areas will be liquid real estate in the near future.

If in the past, investors often invested more “riskily”, now they tend to invest more “safely”. Therefore, choosing real estate products with full legal status is natural; “green rice” products are eliminated first.

However, according to Mr. Duy, when real estate prices have decreased, bank loans are also more favorable... investors need to observe macro trends, this is very important.

“In the near future, there will be a part of investors who will take profits from stocks and switch to real estate. Those are people with money, they will participate in investing in the housing segment in big cities,” Mr. Duy added.

Interest rates are down, with billions available, which area should I invest in real estate?

Interest rates tend to decrease, with billions of dollars available, wanting to invest in real estate, what product should I choose, which area has potential at this time?

'Buying gold is a loss, buying land is a profit', in 2023, which area should you invest in real estate?

Should we invest in real estate in 2023? If so, which segment and area still have potential to increase in price and make a profit in the future?

Shophouse 'cuts losses' of billions, should you 'put down money' to invest now?

In the Hanoi market, some shophouses need to be sold, "cutting losses" up to more than 1 billion VND but still have difficulty finding buyers. Should you invest in a shophouse at this time, what should you pay attention to?

Source