According to the State Bank of Vietnam, credit growth as of the end of September 2024 was 9% compared to the beginning of the year, equivalent to a growth rate of 16% compared to the same period last year. In particular, credit growth for the real estate sector was higher than the general credit growth, reaching 9.15% compared to the beginning of the year. Outstanding credit for business real estate increased higher than consumer real estate credit, increasing by 16% and 4.6% respectively compared to the beginning of the year.
Currently, real estate credit accounts for over 20% of the total outstanding debt of the economy, but this increase mainly comes from individuals and households borrowing for personal consumption, while businesses still face many difficulties in accessing bank capital to implement projects.
The leader of a real estate company with a large market share in Ho Chi Minh City said that after a period of restructuring debts, his company is negotiating with banks about new loans for the 2025 period. The memorandum of understanding has been signed between the two parties, but the disbursement phase is still quite far away because of waiting for legal solutions from the government. There are projects where the investors fully comply with the legal requirements, but are not in the segment that banks focus on disbursing, so it is difficult to borrow capital.
Real estate businesses now have to manage by liquidating assets or issuing shares, but it is not easy. Current sources of money can only come from selling new phases of projects that have been implemented. Or they have to find partners to resell shares or entire projects that have completed legal procedures.
Dr. Nguyen Duy Phuong, Director of Financial Analysis at DG Capital, analyzed that although the legal bottlenecks of the project have been resolved under new laws, if the capital source problem is not resolved soon, it will slow down the market recovery, especially the two most important capital channels: bank credit and corporate bonds.
In addition, new laws including the 2023 Real Estate Business Law, the 2023 Housing Law and the 2024 Land Law with many new regulations are also clearly affecting the market. In particular, the fact that investors of future housing projects are only allowed to receive deposits of no more than 5% of the selling price is one of the notable provisions in the 2023 Real Estate Business Law.
Experts assess that this regulation will have a strong impact on the operation and development of the project. Because in the past, when the market did not have regulations controlling deposits, many investors collected money from buyers in advance from 30% of the contract value, or even higher. With the current regulations, the capital mobilization from customers will be less, requiring the financial capacity as well as the enterprise's own capital to be very solid.
However, in a recent report, credit rating agency VIS Rating assessed that, in general, real estate businesses' ability to access new capital sources has improved in 2024, thanks to an increase in bank loans for real estate business activities and the issuance of shares doubling compared to the previous year.
In addition, efforts to reach swap agreements, debt extensions and capital rotation also help businesses have more resources to implement projects, bring products to market soon, thereby generating cash flow.
