Dr. Nguyen Van Dinh, Vice Chairman of the Vietnam Real Estate Association and Chairman of the Vietnam Real Estate Brokers Association (VARS), agrees with the spirit of implementing solutions to foster a healthy real estate market. He emphasizes that while curbing speculation is necessary, it should be achieved through market mechanisms rather than administrative mandates to avoid stifling legitimate demand.
Q: Mr. Dinh, the Ministry of Construction has proposed a draft resolution on house price control mechanisms, including a cap on loan limits for second-home buyers at 50% and third-home buyers at 30%. What is your opinion on this proposal?
I understand that the regulatory body is diligently working to devise solutions to control house prices in the current context. The proposal to reduce loan limits for second-home buyers to 50% and third-home buyers to 30% aims to support genuine homebuyers. I fully support and commend the government’s efforts and determination to stabilize house prices.
However, careful consideration and caution are essential to ensure the solution hits the mark. Otherwise, it may not only fail to achieve its goal but also pose risks to the market.
Q: What specific risks do you foresee with imposing such loan limits?
Currently, our real estate database is incomplete and lacks synchronization. Determining whether a property is a first, second, or subsequent home lacks clear, specific, and transparent criteria. This ambiguity could lead to prolonged and costly loan approval processes, affecting transaction outcomes and creating loopholes for corruption and legal circumvention.
Image: Hoang Minh |
This regulation could also unfairly hinder legitimate transactions, such as parents buying additional homes for their children, families purchasing properties for rental business, or individuals buying additional homes due to job relocations.
Q: Some argue that the long-term benefits outweigh the drawbacks, as the proposal could prevent second and third-home buyers from leveraging bank capital, thereby cooling house prices. What is your take on this?
To achieve long-term benefits, we must address the root causes of the issue directly, rather than focusing solely on superficial solutions. The primary drivers of rising house prices are supply structure and input costs, not just loan capital. Legal complexities and high land-use fees are the real bottlenecks inflating prices.
Therefore, priority should be given to addressing these fundamental issues, followed by a comprehensive set of solutions. Missteps could create adverse effects, as restricting capital flow against market principles would slow economic growth.
To Lower House Prices, Increase Supply—Don’t Restrict Demand
Q: If this draft is approved, what specific impacts do you predict for the market?
I am concerned that restricting credit for second and subsequent home buyers will directly reduce demand, discouraging developers and shrinking supply. Many projects may face declining sales and revenue, forcing developers to reduce supply, which could further drive up prices—contrary to the intended goal.
China’s experience serves as a cautionary tale. Credit tightening did not lower house prices but instead caused economic decline and widespread business failures. When capital flow is restricted, the market freezes, businesses suffer, and homebuyers face greater challenges.
Q: What is the most effective solution to control and prevent price surges, as seen recently?
As mentioned, the core issues are legal bottlenecks and limited supply. Thousands of stalled projects increase costs, forcing developers to raise prices. Additionally, rising input costs, particularly land-use fees, have significantly driven up house prices.
The correct approach is to enhance supply without restricting demand. The government should streamline legal processes, expedite project approvals, and reduce cost burdens. When developers can bring more products to market, natural competition will drive prices down.
Curbing speculation is necessary, but it should be achieved through market mechanisms, not administrative mandates, to ensure legitimate demand is not suppressed.
Q: Broadly speaking, what does Vietnam’s real estate market need at this stage?
The market requires synchronized and market-aligned governance. We must strive for transparency, comprehensive data management, and natural speculation limits through competition, not by restricting access to housing.
Citizens aspire to own their homes, and businesses seek a transparent environment to thrive. With the right policies, the real estate market will increasingly become a vital driver of economic growth.
Thank you, Mr. Dinh!
Hanh Nguyen
– 11:20 09/10/2025
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