Wednesday,  Apr 24, 2019,23:06 (GMT+7) 0 0
Homebuyers worry about interest rate hike
The Saigon Times Daily
Wednesday,  Jan 23, 2019,14:59 (GMT+7)

Homebuyers worry about interest rate hike

The Saigon Times Daily

File photo of condo buildings in HCMC's District 2. Many homebuyers have voiced concerns over a possible spike in interest rates for home loans - PHOTO: THANH HOA

HCMC – Many homebuyers have voiced concerns over a possible rise in interest rates for home loans due to the banks’ tightening of property loans since the beginning of 2019, Nguoi Lao Dong newspaper reported.

Under the State Bank of Vietnam’s (SBV’s) Circular 19 amending and supplementing some articles of Circular 36, providing safety limits for the banking sector, the central bank asked commercial banks to reduce the maximum ratio of short-term funds used for medium- and long-term loans to 40% this year and to maintain credit growth at a low 14%. Further, SBV asked banks to prioritize loans for production and business activities rather than risky sectors such as real estate and securities.

Nguyen Nhung, residing in Thu Duc District, HCMC, said that she had borrowed VND1 billion for a period of more than 10 years at an interest rate of 7% per year and was worried that the rate would be revised upward in the coming days.

In addition to the hike in interest rates, banks also issued strict regulations on loans, asking customers not to use their loans for other purposes, Nhung said.

A director of a commercial bank in HCMC noted that the high risk coefficient rate imposed on the real estate sector was 200%, discouraging commercial banks from focusing on the sector and affecting customers who needed loans for house purchases.

The real estate market will be controlled and house prices will be stabilized in return for limits on funds injected into the property sector and tight control over credit growth at low rates.

Nguyen Canh Vinh, deputy general director of the Vietnam Export Import Bank (Eximbank), confirmed that the bank did not limit lending to those wanting to purchase houses. Although the interest rates of loans have yet to rise strongly, tight control over short-term funds for medium- and long-term loans will affect 10- to 20-year borrowers.

SBV Governor Le Minh Hung stated that the short-term capital for medium- and long-term loans would continue to be adjusted downward to 35%, 30% or even 25% in the years to come to balance the market, which makes homebuyers even more concerned about interest rates.

Share with your friends:         
Publication Permit No. 321/GP-BTTT issued on October 26, 2007
Deputy Editor-in-Chief: Pham Huu Chuong
Managing Editor: Nguyen Van Thang.
Assistant Managing Editor: Pham Dinh Dung.
Head Office: 35 Nam Ky Khoi Nghia St., Dist.1, Ho Chi Minh City, Vietnam. Tel: (84.28) 3829 5936; Fax: (84.28) 3829 4294.
All rights reserved.