In a bid to stimulate the housing market and assist young people in becoming homeowners, many banks in Vietnam have recently rolled out preferential home loan packages with enticingly low interest rates ranging from 3.99% to 5% per annum. This initiative is part of a broader strategy directed by the Prime Minister to enhance credit access and support the real estate sector.
According to the State Bank of Vietnam (SBV), nine commercial banks have signed up to participate in this program, collectively pledging to provide an estimated 45,000 to 55,000 billion VND in loans. These loans are available for a period of up to 15 years, with interest rates set to be approximately 1-3% lower than prevailing market rates. The goal is to make homeownership more accessible to young individuals, particularly in urban areas where housing prices have skyrocketed.
However, experts caution that while these low-interest loans may seem appealing, they come with significant risks. Dr. Can Van Luc, an economic expert, points out that the initial reduction in interest rates might lead borrowers to be complacent regarding their future repayment capabilities. He warns that once the preferential period concludes, interest rates could be adjusted sharply in line with market trends, potentially leaving borrowers facing unmanageable debts.
"When the preferential period ends, the interest rate will be adjusted according to the market, which may increase sharply," Dr. Luc explained, emphasizing the need for careful financial planning before committing to such loans.
Moreover, the stringent lending procedures and high collateral requirements pose barriers for many potential borrowers, particularly those with unstable incomes or insufficient assets. Dr. Luc advocates for banks to adopt a more flexible approach in assessing loan applications, suggesting they consider non-traditional forms of income verification, such as bank transaction histories and business invoices.
Despite the attractive interest rates, many young individuals still find home prices to be prohibitively high, especially in major cities. Dr. Luc asserts, "If there is no suitable housing supply, lower interest rates alone won’t make it easier for young people to own homes." This highlights a critical issue: the need for a balance between financial incentives and the availability of affordable housing options.
In a related development, TPBank has reported a significant profit of over 2,100 billion VND for the first quarter of 2025, marking a 26% increase from its annual target and a 15% rise compared to the same period last year. The bank's total operating income reached nearly 4,500 billion VND, with interest income contributing 3,380 billion VND. Notably, net service income surged by 27%, indicating a diversification in revenue sources.
As part of its growth strategy, TPBank has been expanding its non-credit services, including digital banking, electronic payments, and personal financial management, to reduce reliance on traditional lending. The bank's digital transformation has attracted millions of new customers, maintaining a healthy ratio of non-term deposits (CASA) above 20%, which in turn lowers capital costs and enhances business efficiency.
Meanwhile, the SBV is expected to maintain its current policy interest rates in the near future, according to a report by UOB. The bank notes that while inflation remains under control, external market pressures, particularly trade tensions with the United States and currency exchange rate fluctuations, necessitate a cautious approach to monetary policy.
UOB predicts that if domestic economic conditions deteriorate significantly in the upcoming quarters, the SBV may consider lowering interest rates to stimulate growth. However, the baseline scenario suggests that the SBV will keep the refinancing rate at 4.5% for the time being.
In another move to enhance customer offerings, Bản Việt Joint Stock Commercial Bank (BVBank) has launched an online deposit certificate product featuring competitive interest rates of up to 6.2% per annum. This product, aimed at individual customers using the Digimi digital banking platform, requires a minimum investment of 10 million VND and offers flexible terms.
The highest interest rate of 6.2% applies to an 18-month term, while a 15-month term offers 6.1%. BVBank emphasizes that these online deposit certificates not only provide high security but also can serve as collateral for loans at the bank. Customers can opt for monthly interest payments or receive their earnings at the end of the term, depending on their preferences.
As the Vietnamese banking sector continues to adapt and innovate, the push for affordable housing and accessible financial products remains at the forefront of discussions. The interplay between interest rates, housing supply, and lending practices will be crucial in determining the future landscape of homeownership for young people in Vietnam.
