Property firms unable to escape debt: expert
The real estate market in Vietnam is finding it difficult to bounce back because businesses are still struggling with piles of bond debts, said expert Nguyen Hoang.
He said that in the first quarter, many real estate businesses had to find money to pay back just small amounts of their bond debts. The remaining balance is putting huge pressure on them despite positive market signs.

The real estate market in Vietnam saw positive signs in Q1/2024. Photo by The Investor/Minh Phuong.
The Ministry of Construction's Q1 market report shows that 10 commercial housing development projects with about 4,706 units were completed in the quarter, equivalent to 34.48% of the tally in Q4/2023 and 71.43% of that in Q1/2023. Of which, three were in the northern region, four in the central region, and three in the south.
There were 38 projects eligible to sell future-formed houses with 5,527 units, or 80.85% and 73.08% of the figures recorded in Q4/2023 and Q1/2023, respectively.
In addition, 984 projects with 421,353 units were under construction, up 15.22% from Q4/2023 and 40.97% year-on-year. Of which, 406 projects with 236,873 units were in the north, 360 projects with 91,022 units in the central region, and 218 projects with 93,458 units in the south.
Notably, in Q1, there were 19 newly licensed projects with 9,774 units, down 5% from Q4/2023 and up 11.76% year-on-year. The northern region had 12 projects, the central region boasted seven, and the south had none.
According to Hoang, former director of R&D at consulting firm DKSH, the market has shown positive signs, recovering slowly.
"However, there are still bottlenecks that may last until the end of this year. Of these, the most concerning is the scarcity of new supply due to legal problems. Typically, in Ho Chi Minh City, legal obstacles to many real estate projects have not yet been resolved."
In addition, property businesses’ bonds worth nearly VND115 trillion ($4.52 billion) will mature this year, and there's pressure of making payment of VND100 trillion ($3.93 million) in bond debts in the remaining nine months of the year. When businesses are still struggling in debt, it is very difficult for them to break through, Hoang noted.
Customers, investors, and regulators are waiting for the enforcement of the new land, real estate business and housing laws, which is having a great impact on the market's recovery, he added.
"Purchasing power at this time remains weak. Only when it grows will the market recover and develop more vibrantly," Hoang added.
To continue removing difficulties and promoting a stable, healthy and sustainable real estate market, the Ministry of Construction has asked localities to focus on clearing bottlenecks as well as proactively promulgating policies to support people and businesses.
For problems beyond their authority, developers should send them to the Prime Minister and his working group for resolution, said Hoang.
On the other hand, businesses themselves need to restructure their project and product portfolios to suit their actual ability and market conditions, he stressed.
"Developers should adjust real estate segments and prices to suit the market and ensure liquidity, thus creating capital flows to maintain operations and implement projects.
"At the same time, it is necessary to review and restructure capital sources, especially credit, to focus on completing each project, avoiding scattered and unfinished investments, thus ensuring loan and bond debt repayments," he added.
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