CEO of HSBC Vietnam Pham Hong Hai has given some opinions about Vietnam’s real estate market and forecasts on the interest rates of home loans in 2019.
Hai said that year 2018 was considered a gairly successful year of the real estate market of Vietnam as the market basically maintained stable development with reasonable restructuring of market segments and products.
The real estate market in 2018 was controlled strictly, the investment flows were clearer, and the policies showed clear points. These factors supported the market sustainability, especially the government’s instructions on apartment building management and operation.
This trend is expected to continue being stable in 2019 in line with the economic growth target set by the government at 6.6-6.8 percent with inflation controlled below four percent, along with the monetary policy of the State Bank of Vietnam (SBV) which is likely to continue the credit growth target of 14 percent.
With the shift of the labour force from rural areas to factories in urban areas, the housing demand for the mid-end and affordable markets will continue to increase. In addition, the luxury apartment projects also draw much attention of foreign investors as the price level in Vietnam is still relatively cheap compared to regional markets.
According to statistics of the National Financial Supervisory Commission (NFSC), the average lending interest rates in 2018 was about 8.91 percent per annum, higher than the 8.86 percent recorded in 2017. The inflation in the first two months of 2019 rose by 2.64 percent and the adjustment of the power prices in March 2019 will significantly affect inflation in the following months.
The mobilisation interest rates of commercial banks have tended to go up recently, particularly the long-term rates. On these bases, the home loan interest rates in 2019 are likely to be stable or slightly increased compared to 2018.
