It's best to "make do with what you have."

"Making do with what you have" is the choice of many homebuyers at this time.

Ms. Yen was introduced to a 150m2 plot of land in Binh Chanh District (Ho Chi Minh City) by an acquaintance, priced at 2.2 billion VND. After viewing the land, Ms. Yen liked it very much. Currently, she has 1.5 billion VND, and if she buys this plot, she will need to borrow an additional 700 million VND. "Although I really like the land, I still don't dare to borrow from the bank at this time, even though interest rates have decreased significantly compared to 2023. I'll see if interest rates will decrease further before I decide, or I'll look for a plot of land that fits my budget so I don't have to worry about the burden of debt repayment," Ms. Yen shared.

Similarly, Mr. Nam also wanted to buy an apartment in District 12 (Ho Chi Minh City), but thinking about having to borrow from the bank, he worriedly said: "If I buy this apartment, I have to borrow an additional 500 million VND from the bank. With a preferential interest rate of 8.5% per year in the first year, but rising to 11-12% in subsequent years, the amount I have to pay in principal and interest is about 9 million VND per month. This borrowing puts pressure on my family's finances , so I've decided to postpone buying the apartment for now and wait for interest rates to decrease further."

According to a recent survey by Batdongsan.com.vn, 70% of respondents said they would wait for bank interest rates to fall further before borrowing to buy a house. 65% believe that interest rates are still high or very high. Many people believe that with current interest rates, if homebuyers don't plan carefully, they won't be able to repay the bank in full according to the schedule. This is because banks usually only offer preferential interest rates in the first year, depending on the loan package. After that preferential period ends, the floating interest rate according to the market is not easy for salaried workers with unstable incomes, not to mention other living expenses. Therefore, for many people who want to borrow to buy a house, "making do with what they have" is the choice at this time.

Many economic experts believe that borrowing from banks is a popular option for owning property without having to save up the full amount of money. Currently, banks offer various home loan packages with diverse interest rates and repayment periods of 15-20 years, and some even offer loans for 30-35 years to meet customer needs. However, regardless of the loan term, the most important thing is to ensure the ability to repay the debt.

When deciding on a loan amount, borrowers need to consider a debt-to-equity ratio that doesn't create excessive financial pressure. During the loan application process, lenders typically provide information on the maximum loan amount, the principal, and the monthly interest payments. Because home loans are often substantial, individual borrowers need to carefully assess their financial capacity, including detailing their family's income and living expenses, before determining the loan amount. This helps borrowers maintain control over their monthly repayments.

Dr. Su Ngoc Khuong, Senior Director of Savills Vietnam, suggests that while many banks may offer loans up to 80% of the property value, customers should only borrow around 40-50%. This is considered the "golden ratio" to maintain a balance between daily life and mortgage repayment. For example, if the apartment is worth 2 billion VND, the ideal loan amount is 800 million VND, equivalent to 40% of the apartment's value. However, to ensure repayment capacity, homebuyers need to consider their family's total income and calculate the monthly payment based on the loan amount, loan term, and interest rate.

In fact, since the beginning of 2023, the State Bank of Vietnam has repeatedly reduced the policy interest rate, creating conditions for lowering deposit and lending interest rates. To date, deposit interest rates are at their lowest level in a decade, and mortgage lending rates have also cooled down significantly. Lower lending rates also mean less financial pressure when borrowing to buy a house. However, the preferential interest rate period is not long, usually 12-24 months, after which floating interest rates will increase again. Not to mention that house prices remain very high; if income is unstable, buyers should not borrow to buy a house.

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