New projects are still coming in slowly.
Specifically, the State Bank of Vietnam (SBV) Regional Branch 2 reported that by the end of April, the total outstanding real estate credit in Ho Chi Minh City reached VND 1,116 trillion, an increase of 0.34% compared to the previous month and a 2.85% increase compared to the end of 2024. The scale of real estate credit continued to be maintained, accounting for approximately 28% of the total outstanding credit in the area. Of this, real estate credit for self-use (loans for purchasing houses, transferring land use rights for house construction; loans for house repairs, etc.) still accounted for a high proportion of the total outstanding real estate credit, reaching VND 727,000 billion, an increase of 0.05% compared to the previous month and a 0.65% increase compared to the end of 2024.
Despite credit growth, very little money is flowing out of the market.
PHOTO: DINH SON
While the figures look quite good, the reality is that both transactions and new projects are sluggish. Therefore, many people are asking, where did all that trillion-dong in real estate credit go?
Mr. Le Hoang Chau, Chairman of the Ho Chi Minh City Real Estate Association, said that although the real estate credit growth figures are very large, he doesn't know who is benefiting from this growth. Because while businesses are still struggling to process legal documents and therefore unable to access capital, the number of people borrowing to buy real estate is also low. Specifically, in the first four months of the year, Ho Chi Minh City only had 3 projects eligible to raise capital, with a total of 3,286 apartments, all of which were high-end apartments. In the first four months of the year, no projects were transferred because, according to the law, a project must fulfill its financial obligations before it can be sold to another partner.
"Compared to 2017, a boom year for the market, the current supply is only 10%. In reality, there is still a shortage of supply, especially for affordable housing, particularly social housing, and land and house prices continue to rise steadily. The total number of apartments put on the market from the beginning of the year until now is very small, and transactions are not numerous, yet the credit growth reported by the State Bank of Vietnam is very strange. It's not just Ho Chi Minh City that's seeing growth, but the whole country is doing the same; I don't understand it," Mr. Le Hoang Chau shared, adding that businesses are still facing significant difficulties with cash flow and capital, especially as they are struggling to meet the maturity dates of corporate bonds around August-December 2025. This forces them to continue to struggle and negotiate with customers to extend debt repayment periods.
Dr. Dinh The Hien, Director of the Institute for Applied Informatics and Economics Research, also affirmed that businesses still lack capital, have difficulty accessing funds, and the amount of money injected into the market is not significant. Therefore, if real estate credit increases, it is likely that organizations and individuals will borrow to repay old debts or to refinance existing debts. Interest rates combined with the increase in inventory costs will cause outstanding credit to increase accordingly.
"Through a survey of about 100 listed companies on the stock exchange, I noticed that credit growth in the real estate and construction industry has been continuously declining. This is because the cash flow in real estate comes from two main sources: business cash flow and financing cash flow. However, both of these sources are facing difficulties, so real estate companies will continue to face many challenges this year," analyzed Dr. Dinh The Hien.
Individual transactions are booming, and the secondary market is bustling.
Overall, Dr. Nguyen Van Dinh, Chairman of the Vietnam Real Estate Brokers Association, commented: Since the Lunar New Year, the southern market has shown signs of growth and better performance compared to 2024. Although there aren't many new projects, transactions among individuals are also better. According to statistics, the rapid increase in the number of real estate transactions has helped land revenue in Ho Chi Minh City reach a high level, reaching 2,200 billion VND in the first quarter of 2025, an increase of more than 540 billion VND compared to the same period. In addition, revenue from real estate business services reached 25,547 billion VND in March, an increase of 9% compared to the previous month. For the first three months of the year, revenue from this sector reached 72,321 billion VND, an increase of 16%. This is a positive increase, clearly demonstrating the level of investor interest and showing the recovery of the real estate market.
Therefore, according to Dr. Nguyen Van Dinh, although the volume of primary market transactions is low due to limited supply, transactions in the secondary market and the buying and selling of land and houses among individuals are very active. This could be the reason for strong credit growth. Furthermore, although there have been few projects in Ho Chi Minh City in recent months, many projects have been completed and launched in surrounding areas such as Long An, Dong Nai , Ba Ria-Vung Tau, and Binh Duong. Since businesses are based in Ho Chi Minh City, they may have borrowed in the city to invest in these provinces. In addition, the sharp increase in real estate prices in recent times has also led to an increase in the value of loans. "However, it is easy to see that the current market has little real demand and a lot of investment and speculation, so credit capital is flowing into these groups more than into projects," Dr. Dinh analyzed.
Sharing the same view, economist Huynh Phuoc Nghia also believes that credit growth is largely driven by loans for home purchases, repairs, and construction by individuals; while new projects are "losing ground" because the supply has been very limited since the beginning of the year. This is consistent with the State Bank of Vietnam's report, which indicates that loans for home purchases, land use rights transfers for home construction, and home repairs still account for a high proportion of total real estate credit outstanding. Furthermore, recent credit growth is related to restructuring and collateralization, as there is very little cash flowing into the market. While projects in Ho Chi Minh City may face difficulties in obtaining loans due to legal obstacles, businesses can use projects in other provinces or other product types to guarantee loans in Ho Chi Minh City.
Both supply and prices are increasing.
According to the Ministry of Construction 's report on the real estate market in Q1 2025, the volume of real estate transactions in the three categories of apartments, detached houses, and land plots tended to increase compared to Q4 2024. Specifically, the apartment and detached house segment saw 33,585 successful transactions, equivalent to 132% compared to Q4 2024. The land plot segment had 101,049 successful transactions, equivalent to 116.4% compared to Q4 2024. Meanwhile, the quarter saw the completion of 14 projects, comprising approximately 3,813 apartments, representing 140% compared to the same period in 2024. 26 new projects were licensed, totaling approximately 15,780 units, representing 144% of Q4 2024 and 136% compared to the same period in 2024. Nationwide, 994 projects are under construction, comprising approximately 399,873 units. Meanwhile, 59 projects are eligible to sell housing units under construction, totaling approximately 19,760 units, representing 96.7% of Q4 2024 and 155.2% compared to the same period in 2024.
Source: https://thanhnien.vn/tin-dung-bat-dong-san-chay-vao-dau-185250522212250198.htm
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