Property developers thirsty for capital

At a business forum in Ho Chi Minh City on Oct. 28, Vo Hong Thang, R&D vice director at property consultancy DKRA Vietnam, said credit control as well as tightening regulations on access to capital through corporate bond channels has made the real estate market thirst for capital.

According to the General Statistics Office, credit growth by the end of the third quarter reached 10.5%, close to the 14% target set for the whole year.

The credit growth limit is 3.5% left for the last quarter of this year – a very low level compared to the same period in previous years (usually at 4.2-6.2%). Besides, this low rate is still prioritized for restructuring the banking system, and production and business, not for real estate.

While many real estate companies have been running out of capital, investors have grown more cautious because of difficulty in accessing financial sources and high lending interest rates, according to Thang. The property market is likely to decline further in the coming time, he stated.

Nguyen Hoang Bich Ngoc, head of the institutional clients division at Mirae Asset Vietnam Securities, said real estate firms would continue to face many unfavorable factors till the first half of next year. Positive signals regarding macro economy, legal framework, and credit environment will start appearing gradually in the second half of 2023, she predicted.