Rising interest rates and changing real estate investment strategies.

With many banks adjusting home loan interest rates to around 10-14% per year depending on the term, and simultaneously tightening disbursement conditions, the market is entering a clearer phase of consolidation. Investors using large financial leverage are beginning to face pressure, while capital tends to shift towards products with real investment value and the potential to generate stable returns.

Interest rate pressure

After a period of maintaining monetary policy to support economic recovery, interest rates have tended to rise again since the beginning of 2026, along with pressure to control inflation and regulate credit. Specifically, from April 2026, interest rates for real estate loans at many commercial banks continued to remain high, especially for medium and long-term home loans, with many loans applying floating interest rates from 11-14% per year, creating significant pressure on borrowers using financial leverage.

Accordingly, some banks have recorded the following interest rates for real estate loans: VietcomBank applies an interest rate of approximately 9.6%/year for a fixed rate for the first 6 months, and approximately 10.5%/year for a fixed rate for the first 12 months. After the preferential period, the floating interest rate is calculated as the 24-month savings interest rate plus a margin of approximately 3.3%, but not lower than 11.1%/year. BIDV offers real estate purchase loans with interest rates of approximately 9.7%/year for the first 6 months; approximately 10%/year for the first 12 months and approximately 13.5%/year for longer fixed-rate packages.

Interest rates on real estate loans at many banks continue to be adjusted upwards. Photo: Nguyen Quang

VietinBank has adjusted its fixed interest rate for real estate loans to over 12% per year for the first 24 months, after which a floating rate will apply, but not lower than around 14% per year. Similarly, VPBank offers many home loan and real estate investment packages with preferential rates of around 8-10% per year in the initial period, then fluctuating around 12-14% per year depending on credit profile and loan term.

In this context, real estate investment is no longer simply about "buying and waiting for price increases." Rising capital costs have significantly narrowed the profit margins of speculative activities. While previously many investors could borrow up to 60-70% of their property value from banks for short-term trading, this strategy has now become much riskier. Even a few months of sluggish market liquidity can lead to significant interest payments, causing capital to be eroded. Many investors who had hoped for strong returns from suburban land booms are now facing prolonged capital stagnation as transactions decline.

One noticeable shift is that investment sentiment is moving from rapid growth to prioritizing cash flow safety. Instead of hunting for land in areas lacking clear infrastructure, many investors are becoming more interested in products that can be exploited immediately, such as rental apartments, commercial townhouses in densely populated urban areas, or industrial real estate linked to actual production needs.

Meanwhile, real estate businesses are also changing their strategies. Previously, many businesses rapidly expanded their land holdings, developed large-scale projects, and relied heavily on borrowed capital. However, with rising interest rates and tight credit controls, financial pressure is beginning to emerge. Instead of spreading development thinly, many developers are now focusing on segments with good liquidity, genuine demand, and stable absorption capacity.

This trend is particularly evident in the group of businesses developing affordable housing, social housing, or projects with long-term operational potential. This is because the government currently maintains preferential credit programs for social housing with significantly lower interest rates than the general market average, with some programs applying rates of around 4.6-5.4% per year.

Experts believe that the current market is entering a "purification" phase, and those with strong financial capabilities, sound risk management, and project development based on real needs will have a greater advantage. Conversely, businesses that rely too heavily on borrowed capital or implement inefficient projects may face significant pressure for restructuring.

Opportunities for long-term investors

According to Dr. Tran Xuan Luong (Deputy Director of the Vietnam Real Estate Market Research Institute), when interest rates rise, investors also begin to change their perception of real estate value. Previously, the most frequently mentioned factor was the price increase margin, but now, actual exploitation efficiency, revenue generation capacity, and long-term operational potential are becoming more important criteria. However, while rising interest rates create short-term pressure, they also contribute to a healthier market development. When speculative capital flows decrease, the market will have the opportunity to return to real value and demand.

“Despite facing numerous challenges in the market, real estate remains an important long-term asset class, especially in large cities with high urbanization rates. The issue lies in the fact that investors need to change their mindset. Instead of seeking quick profits in a few months, a more suitable strategy now is to choose assets that are resilient to economic fluctuations, generate stable cash flow, and have the potential to increase in value based on infrastructure, population, and actual usage needs,” analyzed Dr. Tran Xuan Luong.

Experts believe that despite rising interest rates, there are still many opportunities for long-term real estate investors with strong financial capabilities. Photo: Doan Thanh

In addition, Dr. Tran Xuan Luong also believes that, in the context of high interest rates and a market entering a strong consolidation phase, investors need to shift their mindset from "speculating on trends" to investing based on real value and the ability to generate stable cash flow, while also being forced to carefully consider long-term financial pressures.

Investors should also prioritize properties that meet real housing needs, have complete legal documentation, clear infrastructure, and immediate development potential, as these are considered more resilient assets in a highly differentiated market. In particular, this is also an opportune time to restructure portfolios, prioritizing long-term strategies over short-term speculation. Properties that serve real housing needs, are located in areas with integrated infrastructure, or have stable commercial potential will likely maintain their value better in the new market cycle.

"The period of 2026-2027 will be a time when the market shifts from rapid growth to more selective development, in which capital tends to focus on products with practical use value instead of chasing short-term price increase expectations," Dr. Tran Xuan Luong commented.

Source: https://hanoimoi.vn/lai-suat-leo-cao-va-cach-dau-tu-bat-dong-san-thay-doi-936065.html