The general level of home loan interest rates increased sharply after the preferential period
A Q2/2026 survey by the Vietnam Real Estate Market Evaluation Research Institute (VARS-IRE) at 10 commercial banks shows that preferential home purchase loan interest rates are currently commonly 8.5-11%/year, applied for 6-12 months depending on the bank and credit package. After the preferential period, most loans switch to floating interest rates, calculated according to the base interest rate or reference interest rate plus a margin of about 3.3-3.5%. Thus, the actual interest rate borrowers pay is commonly 13-15% per year.
The sharp increase in interest rates put great pressure on many homebuyers. Ms. Tu Tran (An Phu ward, Ho Chi Minh City) shared that in 2025, she and her husband borrowed 1.5 billion VND for 35 years, with preferential interest rates of 7.8%/year, paying 11-12 million VND per month. After the incentives expired in March 2026, interest rates increased to 13.9%, 16.9% respectively and from April 2026 reached 17.7%/year, causing the family's debt repayment costs to increase significantly.
The sharp increase in lending interest rates is also causing both real homebuyers and investors to simultaneously turn their backs on bank leverage.
Mr. Doan Quoc Viet - residing in Ben Thanh ward, Ho Chi Minh City - said that if a few years ago, the use of leverage with a loan ratio of 50-60% of asset value could still be compensated by the price increase of the market, now the real estate price level is already high, while capital costs are no longer cheap. Each month, you have to pay a very large loan interest, while the possibility of price increase in the short term is not really clear. This makes short-term profit expectations no longer attractive enough to trade off risks.
Major barrier to liquidity in the real estate market
Financial pressure is clearly reflected in the market liquidity in the past quarter. According to Dat Xanh Services, when the general interest rate level was 9-11% in 2025, the absorption rate of new supply reached about 45-50%. However, when interest rates increased to 12-14% in the first half of this year, the absorption rate decreased to 20-30%, showing that buyers are increasingly cautious about escalating capital costs.
PropertyGuru's consumer psychology report on real estate shows that more than 80% of homebuyers and investors only accept borrowing to buy real estate when the interest rate is below 9%/year. In which, for the majority of buyers, the most suitable interest rate is from 5-9%/year, and most will stop using financial leverage if the loan interest rate exceeds 11% or more. This is also the reason why the current interest rate level has become a major barrier to the real estate market.
Looking towards the second half of 2026, experts believe that banks will still have to continue to "struggle" to be able to "strain" interest rates.
Dr. Nguyen Duy Phuong - Director of Financial Investment Division of DG Capital Fund - said that the pressure to increase the interest rate level is still high as the credit-deposit balance is still high. The interest rate level will hardly decrease sharply when the capital demand of the economy is forecast to continue to increase sharply in the next 5 years, with the goal of increasing the total social investment capital/GDP ratio from 32% to 40%.
This makes banks still need to maintain attractive interest rates to attract deposits, especially for long terms to ensure capital sources and control liquidity risks. Along with that, the ratio of outstanding loans to total deposits of banks and the ratio of short-term capital for medium and long-term loans of large banks are both reaching the threshold.
