Interest rates fall sharply
According to Tien Phong , home loan interest rates have decreased by 1-3% per year compared to the beginning of this year, but in the context of a sluggish real estate market, demand for home loans remains low.
According to a survey at many banks, the current interest rate for home loans ranges from 8-10%/year. Specifically, at the group of state-owned joint-stock commercial banks, Agribank offers home loans with an interest rate of 8.5%/year for the first year. Vietcombank has a real estate loan package with an interest rate of 8.5%/year for the first 12 months, 8.8%/year for the first 18 months, and 9.7%/year for the first 36 months.
At PVcomBank, the interest rate for home loans is 9%/year for the first 6 months, or 10%/year for the first 12 months, the maximum loan term is 25 years and the bank offers many repayment options, and also allows principal grace period.
The interest rate for real estate loans at Techcombank in the first 6 months is 8.5%/year, the interest rate for the first year is 9%/year.
ACB also launched a real estate loan package with a sharply reduced interest rate and many attractive policies. Specifically, the first year's interest rate fluctuates at 8%/year; the floating interest rate from the second year is calculated by the base interest rate plus a margin of 3%.
In the context of the real estate market remaining sluggish, the demand for home loans remains low. Illustration photo from the internet
Foreign-invested banks have also joined in reducing home loan interest rates. For example, Shinhan Vietnam offers home loans at interest rates of 8.3% per year for the first 6 months and 9.7% per year for the following years; or 8.5% per year for the first year, 9.3% per year for the first 2 years, and 9.5% per year for the first 3 years.
At Wooribank, the first year loan interest rate drops to 8%/year, the floating interest rate next year is only about 8.8 - 9%/year.
However, according to Nguoi Lao Dong , the segment of individual customers borrowing to buy houses is very low. Specifically, outstanding credit balance for loans to buy land use rights by the end of August 2023 only reached over 62,700 billion VND, down from over 63,200 billion VND at the end of July.
The balance of future housing guarantees remained almost unchanged from the previous month, indicating that demand for apartments in projects did not increase much.
Many people said they want to borrow money to buy a house but are still hesitant because they are worried that interest rates will increase again after the preferential period.
Besides, due to the sluggish real estate market, many people still expect that land and apartment prices may decrease further in the near future, so they are not in a hurry to "put down money" at this time.
In addition, currently many investors of affordable apartment projects in suburban areas and neighboring localities of Ho Chi Minh City are applying policies to support customers with interest-free loans or slow payments according to project progress, so many customers do not want to borrow from banks.
Regarding the VND120,000 billion credit package for social housing, worker housing, and projects to renovate and rebuild old apartment buildings, the State Bank of Vietnam (SBV) said that the procedures for building social housing projects are complicated and take a long time to complete.
Many localities are still in the process of compiling project lists and investor needs, so the list has not been announced; the income of home buyers has decreased due to the impact of the economic situation, difficult production and business... so the implementation of this credit package for investors and home buyers has also been very low.
Why?
According to Nguoi Lao Dong, according to an expert, the reason why the demand for personal real estate credit is currently low is because the economy is still difficult, affecting people's income. Therefore, although there is a demand for housing, it is difficult for banks to stimulate credit for home purchases at the current stage. On the other hand, the real estate market is still sluggish, so customers are not interested in borrowing money to buy houses, but expect house prices and interest rates to decrease further.
Mr. Nguyen Dinh Tung, General Director of Orient Commercial Joint Stock Bank (OCB), informed that from now until the end of the year, home loan interest rates will decrease further, but the extent of the decrease depends on the market. However, not all low interest rates will have demand from customers. In fact, many loan interest rates are now equal to the pre-Covid-19 period.
Also related to real estate lending, the State Bank informed that outstanding real estate business loans in the first 7 months of the year grew by 18.95%, exceeding the growth rate of the whole year 2022 (10.73%), this is a very high increase, more than 4 times the general credit growth. Meanwhile, outstanding consumer loans and self-use real estate loans (accounting for 65% of outstanding credit loans in this segment) decreased by 1.36%. "This shows that credit capital is focusing on the supply side of the market, while credit demand for real estate purchases for consumption and self-use purposes is decreasing" - Governor of the State Bank Nguyen Thi Hong stated in the latest report to the National Assembly.
According to the head of the State Bank, the above figures also show that the recent solutions to remove difficulties for the real estate market have begun to take effect, the legal difficulties of real estate projects have gradually been resolved, contributing to increasing the ability of project investors to access credit. "However, in the context of general difficulties, buying a house is not a priority need for customers at the present time. The product structure is unreasonable, there is an excess of products, high-end segments; there is a lack of affordable housing, suitable for people's needs; real estate projects face legal difficulties so they do not meet credit conditions, leading to difficulty in accessing capital sources" - the Governor of the State Bank explained.
A solution recently implemented by the banking sector to stimulate demand for real estate purchases is to allow borrowing from other banks to repay old loans. However, after nearly 2 months of implementation, only a few commercial banks have announced loan programs for customers to repay debts from other banks, but the conditions and procedures are not simple. Many people want to borrow to repay home loans and car loans from other banks to reduce interest rate pressure (because existing loans have much higher interest rates than new loans) but have not been able to do so.
According to the survey results of the Vietnam Association of Realtors (VARS) on the impact of mechanisms and policies, real estate enterprises said that positive signs have begun to appear. Many enterprises have restructured debts, restructured business operations, and started implementing new projects that have been cleared in terms of legality and capital. However, many enterprises continue to face difficulties and challenges in terms of transaction needs, land law, or pressure to pay off maturing bonds...
Demand for home loans 'hit rock bottom' despite falling bank interest rates.
Dao Vu (T/h)
Source
Comment (0)