Since the beginning of 2020, when the State Bank officially introduced regulations to control loans for real estate, the market has really entered a quiet period.
East Saigon urban area
Experts commented that, although the year 2020 still faces many challenges, fundamentally, funding sources for the real estate market are still likely to develop.
Even in 2021, capital for real estate is expected to recover strongly due to many factors.
Recently, the deposit and lending rates have been continuously decreasing, showing that commercial banks are having trouble because there are no borrowers.
Normally, when interest rates drop sharply, investment channels such as real estate will always be considered a good investment channel because there can still be two streams of profit from leasing business or expected to increase prices time.
Since the beginning of 2020, when the State Bank officially introduced regulations to control loans for real estate, the market has really entered a quiet period. This leads both banks and investors to face many difficulties.
From a business perspective, business owners said that it is very important to have supportive policies for the real estate sector because this is an area closely related to the banking system.
Currently, loans for real estate projects are mainly in banks. If real estate collapses, loans in the real estate sector turn into bad debt. According to the chain, when the banking system is broken, the economy will be paralyzed.
In fact, the capital flow into the real estate market is facing many temporary obstacles. However, many investors remained calm, optimistic, and maintained their commitment to participate in the market in the long term.
Investors are currently waiting for opportunities, not really returning to the market, so in 2020 the market will not have many changes.
Notably, the epidemic has been relatively well controlled in Vietnam, so many businesses are preparing for business operations to return to normal trajectories.
Therefore, businesses operating in the real estate sector themselves expect to have more successful transactions when the market is expected to recover in the last months of 2020 and 2021.
Assessing the most important factor of the real estate market is capital flow, Dr. Can Van Luc - Chief economist of BIDV analyzed, entering 2021, this source of capital will recover strongly based on many factors such as economic growth and people's ability to income; Foreign investment inflows (FDI) continued to be attracted strongly thanks to the trend of investment shifting and the effective and effective implementation of free trade agreements.
At the same time, Vietnam's stock market is also expected to be upgraded in the next few years as well as the revised Securities Law effective from January 1, 2021, will facilitate the market for corporate bonds and capital. private investment development, including real estate investment trusts.
According to the State Bank of Vietnam, as of the end of June 2020, the scale of real estate credit capital reached 1.6 million billion VND, accounting for about 19% of the total outstanding loans of the economy. tell the construction loan.
Social housing project (Photo: Internet)
Of these loans for housing accounts for 63%, the rest is credit for real estate business. If only for the first 6 months of 2020, real estate credit will increase by about 1.5%, lower than the overall growth rate of 3.26%.
As for private capital, by the end of August 2020, equity capital of listed real estate businesses reached VND 397,000 billion, a decrease of 2% compared to the beginning of 2020. Along with that, the number of real estate enterprises newly established production reached 3,620 businesses, down 24% and suspended real estate businesses increased 98% over the same period last year.
Specific analysis of FDI to September 2020 also shows that foreign investors have invested in 18 fields; in which, processing and manufacturing industry ranked first with total investment capital of nearly 9.9 billion USD, accounting for 46.6% of total registered investment capital.
Real estate business continued to rank 3rd after the electricity production and distribution with total registered capital of nearly 3.2 billion USD respectively.
Experts say that the Government does not directly finance the real estate market, but still implements supportive policies such as social housing development policies, housing for low-income people. Specifically, the current funding source for social housing policy is about 3,000 billion VND in social housing development funds and the Bank for Social Policies.
This capital source is expected to increase by about 3,000 billion VND by 2021 because the Government has assigned the Ministry of Planning and Investment to be responsible for balancing this capital source from the budget to continue supporting housing loans.
At the same time, the investment capital for infrastructure development is also considered as the factor that will contribute positively to the real estate market, especially the disbursement policy of public investment is being promoted in the fifth period. 2020 - 2021. This investment inflow is also expected to contribute to boosting the construction and real estate sectors; Including the spillover benefits from the increasingly improved infrastructure.
However, from the beginning of 2020 up to now, there has been a phenomenon of real estate businesses massively mobilizing capital from issuing bonds. However, many experts also warn that the form of capital mobilization by bonds, business cooperation ... is essentially a method of financial investment, with many hidden risks.
Because in nature, the form of capital mobilization, but the assets are not owned by the capital contributor. Therefore, all legal obligations are based on the cooperation contract with the issuer only, so there is no guarantee.
Mr. Tran Khanh Quang - General Director of Viet An Hoa Real Estate Investment Joint Stock Company analyzed, the channels with more than 10% profitability, the greater the risk. Bond investors must pay attention to the reputation of the businesses and issuers as well as the banks associated with bond issuers.
With forms of capital mobilization such as capital contribution, business cooperation, when participating investors, they also need to learn carefully about project legislation, real estate products and business information. As a rule, the higher the interest rate, the greater the risk - Mr. Quang warned.
Deputy Head of Finance Department - University of Economics Ho Chi Minh City Le Dat Chi said that banks will have to promote lending in the retail segment to ensure credit growth this year and maintain profit retention.
It is estimated that over the past 20 years, the average rate of return of real estate is about 23% / year, so this is a popular investment channel for many Vietnamese people - Mr. Chi analyzed. Especially at this time, entering the end of the year period, the pressure to increase the investment demand so that money use efficiency will increase instead of leaving it in the bank for a long time with low interest rates.
Many investors are expecting that, when the epidemic is controlled and the economy recovers, real estate will grow quickly again, especially in the planned areas, synchronous infrastructure, prestigious investors credit ...
Thu Hang
TTXVN/Vietnam+
