After the collapse of Vietnam’s real estate market, Vietnam definitely wants to stop the crisis and avoid the contagion to other industries. In previous news, the Ministry of Construction even submitted a proposal for foreigners and expats to be able to own land use rights similar to Vietnamese. And now, the State Bank of Vietnam (SBV) is cutting down interest rates.
In fact, since the start of 2023, the SBV has continuously reduced the Vietnam interest rates, by a total of 0.5-2 percentage points per time. It has also ordered banks to minimize expenses to lower lending interest rates to aid businesses, people, and economic recovery.
But is cutting down interest rates enough to stop Vietnam’s real estate market collapse? Let’s find this out!
First, Let’s Talk About Vietnam Interest Rates
The Vietnam real estate market has been gradually bouncing back since May. The second quarter recording better results than in the first quarter. Prices of real estate stocks have increased 18% and construction stocks 39%.
The interest rate landscape of 2023 has gone through significant adjustments. Reassuringly, recent developments have seen interest rates dropped down to the levels witnessed during the initial half of 2022 at 4.5%. This deliberate course correction means the government’s commitment to make things better for investment and economic growth.
If lending interest rates for both new and old loans decline, the financial pressure on investors will ease. Besides, if deposit interest rates are brought down to under 5%, money will return to Vietnam real estate and increase transactions in the market.
What Is Happening With Foreign Investors Buying Real Estate In Vietnam?
Find out more in this episode with Lawyer Ken Duong as he will dissect in detail of what really happen to Vietnam real estate market
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