{"id":15140,"date":"2016-06-02T04:22:07","date_gmt":"2016-06-01T21:22:07","guid":{"rendered":"http:\/\/www.siamlandbank.com\/propertynews\/property-news\/is-vietnams-property-sector-getting-too-hot-for-its-governments-comfort\/"},"modified":"2016-06-02T04:22:40","modified_gmt":"2016-06-01T21:22:40","slug":"is-vietnams-property-sector-getting-too-hot-for-its-governments-comfort","status":"publish","type":"post","link":"https:\/\/www.siamlandbank.com\/propertynews\/property-news\/is-vietnams-property-sector-getting-too-hot-for-its-governments-comfort\/","title":{"rendered":"Is Vietnam\u2019s property sector getting too hot for its government\u2019s comfort?"},"content":{"rendered":"


\nVietnam set to subdue real estate lending in 2017\u00a0
\nHo Chi Minh City
\nFearful of an overheating property sector, the State Bank of Vietnam last week issued a circular detailing more restrictive guidelines on real estate lending.
\nStarting 1 January 2017, the central bank will rein in commercial institutions that use more than 50 percent of short-term funds for mortgages and other medium- to long-term lendings. The risk weight of credit exposure to real estate businesses will also be raised from 150 to 200 percent.
\nWith outstanding loans to the property sector hovering at VND393 trillion (USD17.42 billion) last year, the state bank hopes new rules would deter another speculative property bubble.
\nProperty investment in Vietnam has been gaining traction at relatively runaway rates. According to the Construction Ministry, the outstanding balance of real estate loans has grown at a rate of 10-15 percent over the last few years.
\nMeanwhile, the Vietnamese cement market had a using rate of 64 percent in 2015.
\nMore: HCMC to host high-level real estate conference
\nEarlier talks of credit tightening had been more restrictive. As early as March 2016, the state bank defended plans to raise the risk weight for real estate loans to 250 percent.
\nThe draft revisions would have also prevented banks from using more than 40 percent of short-term deposits for mortgage lendings. Currently, banks can use 60 percent.
\nReduced capital adequacy ratio from those plans would have greatly undermined a dependable source of funding to domestic borrowers. The Ho Chi Minh City Real Estate Association (HoREA) promptly protested the original restrictions and penned a letter urging the state bank to allow at least half of short-term funds for credit, per Thanh Nienh News.
\nThe state bank\u2019s apprehensions may not be entirely unfounded. Vietnam plunged into a property bubble from 2006 to 2010, with outstanding loans for property standing at VND200 trillion in 2009.
\nThe new round of restrictions could drive domestic investors toward the country\u2019s nascent securities market. Last year, the Vietnamese government lifted a 49 percent hard cap on foreign ownership of publicly listed companies.
\nJoin the discussion on Vietnam real estate \u2013 here are 5 reasons why you should join Property Report Congress Vietnam
\n
\nSource : property-report.com
\nRead more…Is Vietnam\u2019s property sector getting too hot for its government\u2019s comfort?<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Vietnam set to subdue real estate lending in 2017\u00a0 Ho Chi Minh City Fearful of...<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"false","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"spay_email":"","footnotes":"","jetpack_publicize_message":"","jetpack_is_tweetstorm":false,"jetpack_publicize_feature_enabled":true},"categories":[1],"tags":[],"class_list":["post-15140","post","type-post","status-publish","format-standard","hentry","category-property-news"],"jetpack_featured_media_url":"","jetpack_publicize_connections":[],"jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p75ss1-3Wc","jetpack-related-posts":[{"id":16070,"url":"https:\/\/www.siamlandbank.com\/propertynews\/property-news\/what-the-foreseeable-future-holds-for-vietnams-property-sector\/","url_meta":{"origin":15140,"position":0},"title":"What the foreseeable future holds for Vietnam\u2019s property sector","date":"June 10, 2016","format":false,"excerpt":"\r Will the impact of the Law on Residential Housing be felt in 2016? 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