Each bank has a different interest rate plan, how beneficial it depends on the payment solution of the borrower.
To meet customers’ demand for instalment house purchase, banks have massively launched home loan products with preferential interest rates. However, choosing an ideal borrowing option is not simple.
Home loan borrowers always want to buy house from projects being guaranteed by banks such as Vietcombank, BIDV or VietinBank because the interest rates of these banks are always relatively low compared to the general level.
However, after survey, the bank with the lowest interest rate belongs to a foreign bank namely Hong Leong Bank. Currently, when buying a home loan, customers can choose the fixed preferential interest rate package for the first 12 months of 6.5 percent or 24 months with an interest rate of 7.5 percent/ year. At the end of the preferential interest period, the interest rate will be 9.25 percent/ year.
Shinhanbank currently applies the home loan interest rate for the first year of 7.8 percent/ year. Although Shinhanbank tends to increase lending rates but it is still generally in the low group in the market. At the end of the preferential period, Shinhanbank and Standard Chartered Bank will apply the interest rate of 9.5 percent/ year. The highest among foreign banks, such as UOB, only pushed the interest rates for home loans after the end of the preferential period to 9.89 percent/ year.
Meanwhile, at Vietcombank, the fixed home loan interest rate for 12 months is 9 percent/ year, 24 months is 8.9 percent and 36 months is 9.4 percent. Compared to foreign-invested banks, this interest rate is higher but compared to the group of state-owned commercial banks, it is still the lowest. BIDV currently applies 11.4 percent/ year and VietinBank at 11 percent/ year.
In the group of joint stock commercial banks, it is fluctuating at 11 percent -13.5 percent/ year. For example, at Vietnam International Bank (VIB), the six-month fixed interest rate is 7.9 percent/ year, from the seventh month onwards customers bear floating interest rates being calculated based on the formula interest rate plus amplitude 3.7 percent.
Eximbank’s 24-month and 36-month interest rates are also equal to the preferential interest rate of 11 percent/ year; Sacombank is 13.5 percent/ year and Vietbank is 12.2 percent/ year.
According to Le Hoang Chau, Chair of HCM City Real Estate Association, statistics of 65 listed real estate enterprises on the stock market showed that the total value of inventories has reached up to 201.921 trillion dong.
Meanwhile, the credit growth target for banks is 14 percent this year, equivalent to 2018. Therefore, the capital for the real estate industry will certainly be lower than 2018. In addition, the ratio of short-term loans for medium and long-term loans is also tightened.
From the beginning of January this year, banks have reduced the ratio of short-term capital for medium and long-term loans to 40 percent. This credit source not only makes it difficult for businesses but also individual home loan borrowers.
However, these policy adjustments are considered necessary in the context that the real estate industry was very active last year. According to BVSC’s forecast, 2019 will be a slowing year for the real estate industry, from 193.2 percent in 2018 to 43.6 percent this year.
