High interest rates are slowing down the residential property market in Vietnam as potential buyers find it difficult to get loans, it is claimed.
According to CapitaLand Limited, Southeast Asia’s biggest property developer, buyers cannot get bank financing as interest rates have soared to 22.42%, one of the highest in the region.
The central bank has increased its refinancing rate to 15% from 9% while lending costs for some businesses are up to 25%.
‘A lot of purchasers want to buy but they may not be able to borrow money. So the whole market has more or less slowed down,’ said Yip Hoong Mun, deputy chief executive officer of CapitaLand’s Vietnam unit.