Real estate bonds go through difficult times

According to experts, the most difficult time for real estate bonds has passed, as the State has had timely policy solutions.

In 2024, the maturing bond debt of real estate enterprises will be at its highest level in the past 5 years, reaching VND120 trillion. Although it is considered to continue to be a challenging year, according to experts, the most difficult time for real estate bonds has passed, when the State has timely removed policies, businesses and investors have a common voice, reducing the pressure to pay or buy back early.

Latest information on the Hanoi Stock Exchange, the investor of the One Central HCM project - a prime project located in the heart of District 1, Ho Chi Minh City has successfully extended 10 bond lots worth VND10,000 billion for another 1-2 years, with the interest rate reduced from more than 11% to 8% per year. According to experts, extending bond debt is the best solution at present for investors and businesses to have more time to restructure financial resources, promote investment, construction, business, recover capital early, and pay debts.

According to market participants, the fact that investors and issuers have learned how to negotiate with each other to extend or restructure bond debt is one of the factors helping the market move in a more positive direction.

Real estate bond market is more active

Mr. Phung Xuan Minh - Chairman of the Board of Directors of SaigonRatings commented: "Real estate businesses are due to expire, but the most difficult time for them is now over, the State has removed many policy and legal issues to allow projects to restart. The evidence is that many businesses have started to mobilize capital to continue to restart projects."

In addition, other factors that help the real estate bond market become more active are low interest rates and abundant bank liquidity. This is considered a foundation to support business operations, increasing the opportunity to restore healthy development of the bond market.

Ms. Nguyen Thi Tuyet Hong, Director - Head of Bond Investment Department - Dragon Capital Vietnam said: "Currently, bank debt and interest rates are much lower, thereby creating a foundation for businesses, especially real estate businesses, to reduce the burden of their current debts."

According to a representative of the Ho Chi Minh City Real Estate Association, businesses with large outstanding bond debt in recent times have strongly restructured their investments, sold and transferred projects, and even sold at a loss to have capital to handle debt.

And it doesn't stop there, this restructuring will continue to be carried out in 2024 so that businesses can move to a new, more stable phase.

"All of these real estate businesses have endured and overcome the most difficult period. All businesses are making efforts to restructure their businesses, considering restructuring their businesses as a regular task, restructuring investments, restructuring products to redirect products towards real needs" - Mr. Le Hoang Chau - Chairman of the Ho Chi Minh City Real Estate Association shared.

However, difficulties still lie ahead as extending the repayment period is essentially just transferring the payment obligation from one point to another. Therefore, "solving" the difficulties of real estate bonds depends not only on the restructuring efforts of each enterprise but also on the positive recovery of the real estate market.

According to VTV.vn

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