Since January 2024, not only have deposit interest rates decreased, but lending rates have also continued to decline. The latest statistics from the State Bank of Vietnam on interest rates show that the new average deposit interest rate is about 3.9% per year and the new average lending interest rate is about 6.7% per year. This interest rate level is lower than both pre-COVID-19 deposit and lending rates. For example, at Vietnam International Bank (VIB), individual customers who mortgage real estate at this time can enjoy interest rates as low as 6.5-7% per year.
Meanwhile, many people with idle money are struggling to find investment channels. Mr. Hoang Ha (residing in Binh Thanh District, Ho Chi Minh City), said that his relatives have just paid him a loan of 2 billion VND and he is considering between accumulation and investment channels.
“I prioritize investment and have researched options like borrowing more capital from the bank to buy an apartment for rent, or buying a house in suburban areas as waiting for opportunities for price increases. The low interest rate is a key factor for me to decide to borrow more capital for real estate investment at this time,” Mr. Ha said.
In a recently released update on the real estate industry in 2024, analysts from Maybank Securities observed that key factors that have put pressure on the real estate market since 2018 (the peak was the crisis in 2022), including interest rates, liquidity (bond market), and legal framework have shown significant improvement, especially in the lending interest rate landscape.
Maybank analysts expect that the reduction in lending rates will benefit both businesses and homebuyers. Regulations allowing bond restructuring help alleviate liquidity pressure for businesses in the next two years. Most importantly, the expectation is that new laws regarding land, housing, and real estate business will help address regulatory barriers, creating favorable conditions for project development starting from the end of this year, contributing to a transparent and sustainable real estate market in the long term.
The Ministry of Construction also noted in a recent real estate market report that since the fourth quarter of 2023, the Government and the State Bank have been determined and have made efforts to implement a range of solutions to remove difficulties and increase the credit absorption capacity of the economy.
The real estate market is expected to recover quickly, with interest rates reaching the lowest levels in about 20 years. Therefore, to boost credit demand from the beginning of the year, some banks do not hesitate to offer a series of competitive incentives for real estate loans, especially in the segment of investment or accumulation of real estate.
For example, at Vietnam International Bank (VIB), individual customers who mortgage real estate will enjoy preferential interest rates starting from 6.5-7% per year, with a flexible fixed interest rate term of up to 36 months. For customers who are concerned about finances in the initial period, the bank is implementing a grace period package with no principal repayment for the first 24 months. For customers who want to accumulate real estate but plan to fully repay the loan in the short term, VIB provides a free interest rate package for early settlement after 6 months of disbursement. For customers who still have real estate loans at other banks, they can ease financial pressure by transferring the mortgage loan to VIB with a preferential interest rate of 0% in the first month, and from the second month, a preferential interest rate starting from 6.5% per year.
As a bank with strengths in retail lending, with experience accumulated from more than twenty years of continuously supporting financial needs of customers for real estate purchases for accumulation or residence, VIB has always been committed to providing a quick approval service as well as having a diverse and fast income assessment policy that meets all customer needs. Along with the privilege of fast approval speed based on a streamlined process towards simplification, individual customers of VIB from now until 29/02/2024 will have the opportunity to access mortgaged real estate at VIB with attractive prices, high potential profits, and a 0% interest rate for 12 months.
It can be said that attractive interest rate policies and real estate mortgage products tailored to VIB’s specific needs, as well as those of other banks in general, will help stimulate and increase the attractiveness of real estate investment channels in 2024.
