“Housing supply in next two years will increase rapidly according to the forecasts of up to 67 percent of real estate enterprises, while 33 percent expect just a moderate increase.” This information is from a research project, “Evaluating housing demand and factors determining people’s borrowing for housing in Hanoi and housing trends in 2011,” recently released by Vietnam Report in Hanoi.
The report analyzes real housing demand, as well as factors influencing Hanoi real estate traders’ decisions on whether or not to borrow from banks, and identifying market development trends to help investors and policy makers have an accurate overview of the market.
The report surveyed 400 consumers and individual investors in seven districts of Hanoi, directly interviewed and distributed questionnaires to 10 banks in Hanoi, 20 property enterprises and some top experts in the realty field.
According to the report, in 400 samples in Hanoi, 45 percent of buyers intended to borrow from banks, 25 percent intended to buy with their own money and 30 percent intended to borrow from other sources.
Two realty forms of apartment and land are still the top choice of most respondents, among whom, those with average income lower than VND20 million per month mostly choose apartments (accounting for 47 percent) and others, such as houses built on independent foundation and houses self-built on bought land, account for just 26 percent.
Among those with intention of borrowing from banks to buy houses in next three years, up to 45 percent have income lower than VND20 million per month, about 26 percent have income under VND20 to 30 million per month.
Among those with income lower than VND20 million per month, most (55 percent) choose to borrow less than 20 percent of house price. People with incomes higher than VND20 million per month mostly choose to borrow 30 - 50 percent of house price.
In terms of the three main factors of interest rate, term and procedures when considering what bank to use, most consumers (56 percent) regard the first as very important factor when making a loan, only 20 percent of consumers finding procedures important when borrowing.
Income tends to increase borrowing possibility of consumers. Those with high income expect to continue to borrow in the future, meanwhile the number of people in the family, duration time and interest rate have the opposite influence, in which interest rate has the strongest influence.
60 percent of banks plan to tighten lending procedures and policies, whereas as for short-term loans, 80 percent of banks think that there will not be many changes and only 20 percent expect to tighten their procedures and policies.
For houses priced lower than VND1.5 billion, most enterprises taking part in the survey think that demand for this housing type will strongly increase in 2011 (60 percent), only 40 percent think it will moderately increase.
Quynh Chi
Vietnamese
