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Lenders support dreams of homeownership for youth

Published

2 weeks ago

February 26, 2025

While preferential interest rates for young homebuyers are a positive step from the banking sector, a dedicated government-backed loan fund is needed to address high housing prices and limited availability of loans.

Following the PM’s directive at a February 11 conference with commercial banks, (see Page 16), Asia Commercial Joint Stock Bank (ACB) launched the first home loan package for young individuals aged 18-35 with stable jobs and also a regular monthly income, starting from February 13.

Lenders support dreams of homeownership for youth, Source: freepik.com

The loan offers a tenure of up to 30 years, and a preferential rate starting at 5.5 per cent for the first three months. After the initial three months, the interest rate is determined based on the base rate plus a margin of 3.5 per cent.

Borrowers can also choose fixed interest rate packages ranging from 12 to 60 months, with rates varying from 6.5-8.7 per cent per annum..

“For young individuals with stable employment and a long working horizon, the risk associated with these loans is relatively low. Moreover, the first home loan package can also be considered a financial solution to ensure stable housing, facilitate career development, and improve quality of life,” said an ACB representative.

After launching a credit support programme for young homebuyers, ACB is taking the lead in partnering with real estate developers to finance mid-range housing projects, making it easier for young people to own their first home.

“ACB will work alongside real estate developers to increase the supply of mid-range housing by providing funding for reasonably priced projects, along with dual credit packages that support both investors and homebuyers,” said chairman Tran Hung Huy. “A comprehensive partnership between the bank and major real estate corporations ensures construction progress and price control, enabling young people to achieve homeownership more easily.”

Commenting on the preferential home loan policy for individuals under 35, Tran Manh Hoang Viet, financial planner at wealth management firm FIDT, argued that reduced interest rates alone were insufficient.

“For the policy to be truly effective, the loan process must be simple and transparent, minimising procedural barriers that hinder accessibility. Additionally, the quality of affordable housing must be controlled to ensure buyers are not exposed to legal or construction risks. Simultaneously, a flexible financial support mechanism should be in place for borrowers facing temporary difficulties, preventing an increase in bad debt or defaults,” he added.

PVcomBank is currently offering a real estate loan package with an interest rate starting at 3.99 per cent per annum for the first three months. The loan term extends up to 35 years, featuring a flexible repayment plan tailored to borrowers’ financial capacity.

The bank also provides a principal repayment grace period of up to 36 months, a maximum loan limit of $2 million, and a maximum loan-to-value ratio of 85 per cent. For borrowers opting for a fixed interest rate, the rate is 6.2 per cent for 12 months and 6.99 per cent for 18 months.

SHB has also introduced an interest rate ranging from 6.2-9.5 per cent per annum, with a post-incentive margin of 3.0-3.9 per cent per year, depending on the lending package and customer’s credit rating.

Several banks are offering extended loan terms of up to 35 years, with a maximum principal repayment grace period of five years. Borrowers can schedule repayments flexibly, choosing from options such as equal principal payments, step-up principal payments, or payments aligned with their cash flow on a monthly, quarterly, or semi-annual basis.

At ABBANK, home loans are available for up to 35 years. Under its latest preferential credit programme, customers can secure a home loan with an interest rate starting from 7.3 per cent per annum.

“With a simplified loan process and ultra-fast approval within just five hours, covering up to all the financing needs, customers can secure their dream home without financial worries,” said an ABBANK representative.

Meanwhile, some other major lenders have stated that they are awaiting specific guidance regarding the scale and interest rates of the new loan package for young first-time buyers.

On February 12, the Ho Chi Minh City Real Estate Association submitted a proposal to the prime minister and the Ministry of Construction, recommending a mechanism allowing young individuals aged 18-45 to purchase their first home with an interest rate of 6-7 per cent per annum, secured by the purchased property, over a 10-15 year term.

Hoang Tien Dat, a clerk at Techcombank, noted that the primary concern when taking a home loan is financial planning.

“Financial leverage is only suitable within a 5-7 year timeframe because extending beyond this period results in a substantial total expenditure. Moreover, once the low fixed-rate period ends, the interest rate becomes variable, aligning with market rates,” Dat said. “This floating interest rate can escalate to 9-10 per cent, imposing a significant financial burden. Youngsters tend to sell houses after a few years due to overwhelming financial pressures.”

Pham Duc Toan, CEO of EZ Property, suggested that an appropriate interest rate for young homebuyers would be around 5.5 per cent per annum, as at this rate, a young family would only need to pay $280-320 per month in both principal and interest.

“If banks nationwide implement preferential home loan packages for individuals under 35, it would provide significant social security benefits for young people struggling to secure stable housing. This group represents the core workforce, and prioritising their housing needs would allow them to focus on their careers and contribute effectively,” added Toan.

Phi Duc Anh, tour guide

I am considering a mortgage to purchase my first home. I have been saving for several years, but with rising property prices, it is nearly impossible to buy a house outright. A bank loan would allow me to secure a home now, rather than waiting many more years to accumulate enough funds. My main concern is ensuring that the monthly repayments remain manageable while still allowing me to maintain my current lifestyle and savings.

I am also looking at various mortgage packages to compare interest rates, repayment terms, and fees. Given the current market conditions, a well-structured loan is almost essential for young professionals like myself who wish to own property rather than continue renting indefinitely. It could be a good opportunity, but it depends on an individual’s financial situation.

Tran Luu Ly, lecturer, Thuy Loi University

Currently, I am not planning to take out a loan for a home, but it is something I have been thinking about for the near future.

While owning a home is an important goal for me, I want to be certain I can comfortably afford both the down payment and the monthly instalments. Additionally, I am closely monitoring the real estate market to see whether conditions become more favourable for buyers in the coming years.

It really depends on one’s financial readiness. While it is true that property values tend to rise over time, taking on a mortgage too early could put unnecessary financial strain on young buyers. Some people might be better off waiting a few more years to strengthen their financial position rather than rushing into a commitment that could become difficult to manage.

Ngo Nhat Linh, legal consultant

Several banks like Vietcombank, BIDV, Techcombank, and MBBank have introduced home loan schemes with low interest rates applicable for an initial period ranging from six months to two years, after which the rates are subject to increase.

These packages present a noteworthy opportunity. However, it is crucial to evaluate both the potential benefits and associated risks when assessing a loan. For instance, if one possesses a stable income and a clear financial plan, this could represent a prudent step towards securing long-term housing, rather than perpetually renting a property.

Nevertheless, such an opportunity is only advantageous if the prospective buyer is well-prepared financially, with savings amounting to at least one-third of the property’s value and a stable income.

Ngo Quoc Viet, freelance real estate agent

The current preferential policies represent a promising opportunity for young individuals seeking to acquire their first home.

Following a period of stagnation in the real estate market, property prices have now adjusted to more reasonable levels, while banks are introducing a variety of incentives to stimulate demand. For those who have accumulated an initial sum of savings, coupled with a stable income, this is a favourable chance to establish long-term residence.

The home loan packages are highly attractive, with a 30-year repayment term helping to alleviate the burden of monthly debt obligations.

Furthermore, the fixed interest rate of 5.5 per cent for the first three months is relatively competitive compared to the prevailing market rates.

Ta Hoai Thuong, marketing specialist, Shopee

Given the current preferential policies, this is perceived as a relatively suitable time for young individuals who have accumulated some capital. Although property prices, whether for land or apartments in the city centre, remain high, it appears that Hanoi will have numerous new apartment buildings this year.

Should additional bank loan packages with preferential interest rates become available, it would represent an excellent opportunity for my family to acquire our first house. The loan scheme is particularly appealing, especially with its extended repayment term of up to 30 years, which would alleviate the pressure of monthly repayments.

The fixed preferential interest rate during the initial five-year period provides borrowers with a greater sense of security, particularly for those whose situation is not entirely comfortable.

Related Topics:banking sector homebuyers homeownership

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Real estate capital heading into suburban areas

Published

6 hours ago

March 12, 2025

Industrialzone.net

The shortage of affordable apartments in Ho Chi Minh City has led buyers with tight budgets to seek properties in neighbouring markets.

The real estate market in Ho Chi Minh City is facing a scarcity of land, while the cost of project development is continuing to rise. This has forced investors to carefully consider which product segments to focus on to ensure profits.

Real estate capital heading into suburban areas

Photo: baodautu.vn

Investors with land in strategic locations close to the city centre are prioritising the development of mid-range and high-end products to optimise financial outcomes.

As a result, buyers seeking affordable options are being forced to look elsewhere.

“The shortage of affordable apartments in Ho Chi Minh City has led buyers with limited finances to seek items in neighbourhoods like Binh Duong, Dong Nai, and Long An. In these areas, apartment prices hover at around $1,200-$1,600 per square metre, creating strong demand,” said Giang Huynh, head of research and S22M at Savills Ho Chi Minh City.

From another perspective, the average rental yield for apartments in Binh Duong is currently 4.7 per cent, well above the 3.7 per cent yield in Hanoi and 3.6 per cent in Ho Chi Minh City.

Dinh Minh Tuan, southern regional director of real estate trading platform Batdongsan.com.vn, shared that the high rental yield in Binh Duong is largely due to reasonably priced luxury apartments, with high rental prices and stable occupancy rates.

On average, a luxury apartment in Binh Duong can be rented for $400-$480 per month for a one-bedroom unit, and from $600-$800 for a two- to three-bedroom unit.

Meanwhile, in Ho Chi Minh City or Hanoi, apartments in the $1,800-$2,000 per square metre range can only be rented for around $280-$480 per month, depending on the number of bedrooms, not to mention the increasingly stiff competition in enticing tenants.

In response to the strong capital shift, real estate firms in Ho Chi Minh City’s suburban areas are accelerating legal procedures to launch new projects.

This trend reflects the investors’ agility and creates attractive opportunities for both homebuyers and investors in 2025.

Accordingly, Kim Oanh Group plans to launch a 27-hectare urban area in New Binh Duong City in the first quarter of 2025.

This will be the first project the company has collaborated on with Surbana Jurong, a partner from Singapore, under EDGE green standards.

The project features 1,656 townhouses and terraced houses, and 1,666 social apartments, priced from $28,000 per unit.

Major developer Phat Dat Real Estate Development Corporation plans to launch two major projects, Thuan An 1 and 2 in Binh Duong province, covering a total area of 4.46 ha.

The 1.8ha Thuan An 1 will provide 2,604 apartments and shophouses, while the 2.66ha Thuan An 2 will have 3,270 apartments and 16 townhouses. These projects are located on key roads.

Simultaneously, southern developer An Gia Group plans the launch of 3,000 apartments at The Gio Riverside and 76 shophouses in Di An city.

The three-hectare project, located on the provincial route DT16, offers nicely designed apartments with one to two bedrooms.

Regarding opportunities for homeownership, Phan Cong Chanh, an expert in real estate investment, noted that owning a home requires solid knowledge and time to raise financial resources.

For young people, buying a home immediately is a challenge due to limited finances.

Buyers can explore financial support packages and use leverage to shorten the time needed to purchase real estate. This needs to be accompanied by a reasonable plan to ensure long-term affordability.

“Overall, owning a home is not just a purchasing decision; it also requires a smart financial strategy. Whether choosing to buy immediately, rent, or invest in real estate in any segment, individuals must consider their financial conditions and personal plans carefully,” said Chanh.

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VinFast looks to long term with operational roadmap

Published

8 hours ago

March 12, 2025

Industrialzone.net

Carmaker VinFast aims to become a powerhouse in the electric vehicle market as it grapples with tougher competition abroad.

VinFast looks to long term with operational roadmap

The company wants to double EV sales when compared to last year’s figure

Potential investment from JTA Investment through an MoU between Vingroup and Qatar Investment Fund, which was unveiled last week, aligns perfectly with VinFast’s ambitious vision of scaling up production and sales in a competitive international market, the company said.

JTA Investment is exploring a potential equity investment of at least $1 billion in VinFast, the Nasdaq-listed EV manufacturer, as well as a strategic partnership aimed at supporting the company’s global expansion and technological development.

“This collaboration will unlock significant opportunities for Vingroup and its subsidiaries to drive technological, infrastructural, and sustainable economic advancement in Vietnam, while establishing a foundation for international expansion,” said Le Thi Thu Thuy, vice chairwoman of Vingroup.

Global electric vehicle (EV) competition is expected to get tougher as the demand for EVs is projected to increase further this year, but the outlook is being hindered by uncertainty surrounding tariffs and policy changes.

In 2025, S&P Global Mobility projects that 15.1 million battery EVs will be sold worldwide, a 30 per cent increase on last year. It is anticipated that 16.7 per cent of the light vehicle market will be made up of battery-based EVs.

S&P also reported that major unknowns await Chinese manufacturers BYD and Tesla in 2025 due to assumed changes to the US Inflation Reduction Act.

Last year, VinFast stated that it was delaying the opening of its North Carolina factory until 2028, which will allow the company to optimise its capital allocation and manage short-term spending more effectively, focusing more resources on supporting near-term growth targets and strengthening existing operations.

The company is expanding its strategy in India, Indonesia, and the Philippines, where EV infrastructure is developing rapidly but competition from domestic brands is limited. Experts said that in order to sustain long-term growth, it needs to compete with Chinese manufacturers and prove its competitiveness beyond its home market.

VinFast is scheduled to open factories in Subang, West Java and in the southern Indian state of Tamil Nadu this year. The plan to expand into India aims to seize growth opportunities in the world’s most populous nation and rapidly expanding EV market.

On February 28, VinFast and Motech Automotive Service Centres, through its franchisor and operator in the Philippines, signed an MoU on expanding the service network for VinFast’s EVs in the market. The agreement aims to meet the increasing demand for EVs among Filipino consumers, while affirming VinFast’s long-term commitment and determination to utilise green transformation across the region.

VinFast and Motech will collaborate to accredit over 60 Motech service workshops as approved VinFast service centres. In the Philippines, these service centres will have the authority to handle VinFast EV maintenance, warranties, and repairs. This year, VinFast intends to open over 100 similar service workshops throughout the Philippines.

In 2025, the company has set the ambitious target of doubling sales to around 200,000 EV globally after announcing impressive results in 2024, with 97,300 EVs sold globally, of which about 87,000 vehicles came from the domestic market.

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M&As in crucial sectors poised for rapid expansion

Published

10 hours ago

March 12, 2025

Industrialzone.net

Following the downturn, Vietnam’s merger and acquisition landscape is set to gain momentum in 2025, driven by spearhead industries from technology to manufacturing. Julien Curtet, partner of Index Partners, shared with VIR’s Thanh Van his insights into the overview and the prospect of the market.

How do you see Vietnam’s merger and acquisition (M&A) market affected by global market volatility?

M&As in crucial sectors poised for rapid expansion

Julien Curtet, partner of Index Partners

In 2024, global M&A activity rebounded, reaching approximately $3.5 trillion (a 15 per cent increase from 2023) with around 7,500 deals above $30 million. Corporate acquisitions rose by 12 per cent, and financial investor activity surged by 29 per cent, driven by private equity amid easing interest rates. Key sectors included technology, energy, financial services, and telecom.

Vietnam mirrored global trends with notable M&A activity in technology, energy, and industrial sectors, supported by a resilient macro and rising foreign investment.

In 2024, Vietnam’s M&A market experienced a downturn in transaction value, influenced by global economic uncertainties stemming from geopolitical tensions and currency fluctuations. However, deal volume reached around 160 transactions in the second half of 2024, marking a 25 per cent rise from the first half of 2024 and a 32 per cent jump from the second half of 2023, signalling a strong recovery trend and positive momentum for future growth. Some key deals in the second half of 2024 were Masan’s acquisition of an additional 7.1 per cent stake of VinCommerce from SK Group for $200 million, KIDO’s acquisition of Hung Vuong, Nvidia’s acquisition of VinBrain, and SK Group’s $300 million acquisition of Iscvina Manufacturing.

Mid-cap deals up to $25 million dominated Vietnam’s M&A market, accounting for just over half of total deal volume despite a 28 per cent drop in total transaction value. Mid-size transactions in the second half of the year included ADA’s acquisition of Customore and Elan’s $8.89 million acquisition of TMC Vietnam.

Could you shed light on some key drivers for the Vietnamese market in 2025 and beyond?

In 2025, it is set for strong growth, driven by key sectors such as infrastructure, technology, consumer, and manufacturing. Infrastructure will see a surge in investment, particularly in transportation and logistics, supported by government initiatives.

The technology sector is poised for rapid expansion, fuelled by favourable policies and accelerating digital transformation. Consumer spending is expected to rebound from a low base, signalling a recovery in the consumer sector.

Meanwhile, the manufacturing sector, which contributed over one-quarter of GDP in 2024, is projected to grow by 10 per cent in output, supported by new industrial zones and increased foreign investment.

The market is set to accelerate in the second half of 2025, fuelled by stable global interest rates and rising investor confidence.

Vietnam’s strong economic momentum, pro-investment policies, and booming sectors like technology, manufacturing, infrastructure, and recovery of consumer will drive deal activity, cementing its status as a key M&A hub in Southeast Asia.

How do foreign dealmakers approach strategies amidst global economic uncertainty, especially tariffs and new US policy?

Foreign dealmakers are reshaping their M&A strategies. Despite the challenges, Vietnam remains a key destination for cross-border investment, driven by its rapidly expanding technology, consumer, and manufacturing sectors.

Vietnam is rapidly advancing its technology sector, emerging as a significant player in the global digital landscape. Its commitment to technological innovation is evident through key partnerships, such as the collaboration with Nvidia to establish AI research and data centres in the country.

To further entice high-tech investments, the government offers substantial incentives, including up to four years of tax exemptions and a 50 per cent tax reduction for the subsequent nine years, as well as financial support from national sci-tech development funds.

Additionally, Vietnam’s consumer market is expected to recover in 2025, fuelled by a rising population, and increasing disposable incomes, boosting demand for goods and services. With consumer confidence rebounding and spending accelerating across sectors, Vietnam’s consumer market is regaining momentum as a vital driver of economic growth.

Vietnam is emerging as a manufacturing and logistics hub, attracting foreign investments due to its competitive labour costs (20–50 per cent lower than regional peers) and a 9.8 per cent increase in manufacturing output in 2024. An “anything but China” strategy is driving multinationals to shift production to Vietnam.

The country is also benefiting from major infrastructure projects, including the Long Thanh International Airport and deep-sea ports in Haiphong, are strengthening its logistics position, while expanding industrial areas and cross-border e-commerce fuel growth in both sectors.