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Credit to Vietnam’s real estate industry shows steady growth March to May

Vietnam has seen a jump in credit to its real estate sector from March 31 to May 31 of 3.67 percent according to data from the State Bank of Vietnam via the Ministry of Construction. The biggest percentage-based jumps were in land use rights and Industrial parks, export processing zones with 10.08 percent and 8.18 percent, respectively.

Vietnam’s real estate industry has been struggling for the last two years in the wake of the Evergrande crisis in China in 2022. This led Vietnam to take a long hard look at its own real estate industry in which it found the prevalent misuse of investor funds, particularly those acquired through the bond market, and that a number of real estate firms were grossly over-leveraged. These revelations then went on to spook investors and consequently, at the beginning of 2023, it had become very challenging for real estate firms to access capital.

This loan data would suggest that those challenges may be starting to ease.

Vietnam real estate loans by type, to May 2024

Feb 29Mar 31Feb vs MarMay 31Mar vs May
Urban housing developments303,572315,2193.84%318,7991.14%
Offices42,36743,3362.29%44,0801.72%
Industrial parks, export processing zones78,34979,8011.85%86,3308.18%
Tourism and resort projects43,39348,23911.17%49,1301.85%
Restaurant and hotel projects60,50261,6351.87%61,483-0.25%
Renovations, home repairs121,274130,7327.80%126,790-3.02%
Land use rights79,87385,7577.37%94,40210.08%
Other real estate businesses, investments384,343398,0783.57%424,4226.62%
Houses off-the-plan19,12618,714-2.15%14,406-23.02%
Total1,113,6731,162,7974.41%1,205,4373.67%

See also: Vietnam’s Real Estate Market Recovery 2024: Unpacked

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