Hesitant... to borrow money to buy a house.

Despite low interest rates, many people remain hesitant to commit to buying a home.

According to data from the State Bank of Vietnam, as of the end of September 2024, outstanding loans for home purchases increased by only 4.6%, significantly lower than the total outstanding credit of the economy . This slow growth reflects the fact that the demand for loans to buy houses remains low, despite banks having simultaneously reduced interest rates and introduced preferential policies to attract borrowers.

Many attractive policies

Mr. Le Minh Nghia, a credit officer in the individual customer segment at a major bank in Ho Chi Minh City, said that in recent months, the number of customers borrowing money to buy houses has shown a slight increase. However, according to him, the main reason is that banks are fiercely competing to offer loan packages with soft interest rates and flexible repayment terms, making it easier for borrowers to ensure their ability to repay.

A new apartment project is being launched for sale in Ho Chi Minh City. Photo: TAN THANH

Mr. Nguyen Dinh Thang, head of the individual customer division at Asia Commercial Bank (ACB ), said that although banks have reduced interest rates to boost lending, demand for home loans remains limited. This is partly due to the continued high price of real estate, while regulations on real estate investment and transactions are undergoing significant changes with the enactment of the 2024 Land Law. Despite the increasing demand for housing, home lending has not yet seen a strong breakthrough.

In this situation, banks continue to implement attractive policies to attract borrowers. For example, Vietnam International Bank (VIB ) has launched a 30,000 billion VND credit package for loans to buy townhouses and apartments with preferential interest rates and flexible repayment solutions.

Ms. Thu Dung, who is preparing to buy a house, said that when she approached VIB to borrow 1 billion VND, she was advised by bank staff that interest rates ranged from only 5.9% - 6.9% - 7.9% per year, fixed for 6 - 12 - 18 months. "VIB also waives principal payments for up to 5 years for loans to buy apartments and up to 4 years for loans to buy townhouses. This will help me reduce my monthly installments over the long term," Ms. Dung said.

Meanwhile, Mr. Le Viet Thanh (District 12, Ho Chi Minh City) said that at the beginning of 2024, he approached Vietnam Export Import Commercial Bank (Eximbank) to borrow money to buy a house. At that time, Eximbank offered an interest rate of 8% per year, fixed for the first 12 months, but he did not borrow because he was worried about job instability.

"To date, after preparing my financial plan, I contacted Eximbank again and was informed by a bank employee that the loan term is up to 40 years, with a 7-year grace period for principal repayment (during the first 7 years, borrowers only pay interest monthly, not principal); the interest rate has decreased by 1 percentage point compared to the beginning of 2024," said Mr. Thanh.

Furthermore, Vietcombank (Vietnam Foreign Trade Commercial Bank) is also participating in the competition by offering preferential home loan interest rates starting from only 5.4% per year, with fixed terms for periods ranging from 6 months to 2 years. However, after the preferential period ends, the interest rate will be calculated based on the 12-month term savings interest rate plus a margin of 3.5%.

Still worried about interest rates rising after the preferential period.

Although banks offer quite attractive interest rates in the initial period, many customers remain apprehensive about the possibility of interest rates increasing after the preferential period. Dr. Nguyen Van Thuan, a lecturer at the University of Economics and Finance in Ho Chi Minh City, believes that it is reasonable for banks to calculate interest rates after the preferential period based on the base interest rate plus a certain margin.

However, customers need a clear explanation of the mechanism for determining the base interest rate and the factors affecting this rate so that they can calculate future costs when borrowing. "Only then will people be confident in accessing loans, and the credit of banks will improve," Mr. Thuan said.

In reality, over the years, many existing customers have had to pay significantly higher interest rates than the preferential rates offered to new customers. Some customers report still paying interest rates of 10%-11% per year on previous loans, while the current preferential interest rate is only 6%-8% per year in the first year. This creates an unfair disparity between customer groups, causing dissatisfaction and resentment among existing borrowers.

However, many prospective homebuyers say that interest rates are not the most important factor; rather, the poor liquidity and sluggishness of the real estate market are what deter them. Even those who previously borrowed to buy townhouses, land plots, or apartments for investment, rental, or to wait for price increases are now hesitant to make a purchase, despite very low interest rates.

According to Dr. Can Van Luc, a member of the National Financial and Monetary Policy Advisory Council, outstanding real estate loans reached 3.15 trillion VND by the end of September 2024, accounting for nearly 21% of the total outstanding loans in the economy. However, loans for home purchases only increased by 4.6%, much lower than loans for real estate business, indicating that despite low interest rates, the housing market has not yet seen a strong breakthrough.

The main reason people are reluctant to borrow to buy a house is that real estate prices remain high, exceeding the financial capacity of most people. Affordable housing options are scarce, especially in Ho Chi Minh City and Hanoi, where 80% of projects launched in 2024 belong to the high-end segment. High house prices have driven up the cost of living for residents, making home loans difficult.

The demand for loans under 2 billion VND is dominant.

According to recent surveys, most homebuyers choose apartments and townhouses priced under 2 billion VND. This indicates that the demand for affordable home loans, suitable for the income of the majority of the population, remains very high. However, the shortage of affordable housing projects in major cities like Ho Chi Minh City and Hanoi has made it difficult for those in need of loans to access suitable products.

Source: https://nld.com.vn/rut-re-vay-tien-mua-nha-196241216202148125.htm