Vietnam Mortgage Surge Pushes Homes Out of Reach

The cost of buying a home with a mortgage has risen sharply in Vietnam in 2026. Average promotional rates for the first 12 to 24 months reached 10.9% in August across a sample of major banks and can rise to 13–15% after introductory periods expire. Apartment prices in Hanoi and Ho Chi Minh City remain high, transaction volumes are falling and most new supply is still concentrated in expensive segments.

Vietnam mortgage rates move above 10%

Vietnam's home-loan market has changed significantly during 2026. Bloomberg highlighted the affordability squeeze on Sept. 9 as rising mortgage rates added another obstacle for households already facing elevated property prices. Bloomberg

By August, promotional fixed mortgage rates for the first 12 to 24 months averaged 10.9% across 11 commercial banks. VPBank was charging 13.2% for a 12-month fixed period, MSB and ACB were around 11%, while VIB offered 11.1% for 12 months and 12% for 24 months. In the second quarter, comparable 12-month promotional packages at 10 banks had generally ranged from 8.5% to 9.2%, VnExpress reported, citing DKRA Consulting and the Vietnam Institute for Real Estate Market Research and Evaluation.

The introductory rate does not necessarily represent the long-term cost of a mortgage. After the promotional period, loans commonly switch to a floating rate that can be reset by the lender. Vietnam's Ministry of Construction said real-estate lending rates were generally around 12–14% in the second quarter. Post-promotional floating rates were typically 13–15% and reached 15–16% at some banks. High rates have been accompanied by tighter loan limits and income-verification requirements.

Banks are paying more for funding

The mortgage increase reflects wider pressure on bank funding. System-wide credit grew 7.41% in the first half of 2026 from the end of last year, while funds mobilized by credit institutions increased 5.02%.

The gap was wider across 28 listed banks, where loans expanded 18.2% year on year while customer deposits rose 11.9%. Market-based funding, including deposits and borrowing from other credit institutions as well as debt securities, accounted for nearly 29.7% of key funding sources. Funding costs rose by almost 60 basis points and net interest margin slipped to 2.92%, according to Guotai Haitong Securities Vietnam.

Short-term liquidity improved later in the summer. As of Aug. 22, Vietnamese-dong deposits had increased 8.77% from the beginning of the year, slightly faster than the 8.38% rise in outstanding dong-denominated credit. That reversed the first-half pattern, although analysts cautioned that stronger liquidity did not necessarily imply an immediate fall in borrowing rates, Vietstock reported.

Real estate accounts for a quarter of bank lending

The housing market is particularly sensitive to financing conditions because banks already have substantial exposure to property.

Real-estate credit expanded 42% in 2025, compared with 19% growth in total banking-system credit, and accounted for 25.5% of outstanding loans, according to the World Bank.

In some areas, land and housing prices exceeded 30 times annual household income. The report compared that with international affordability benchmarks typically ranging from three to eight times annual income. It also pointed to a maturity mismatch in a banking system where relatively short-term deposits can be used to finance long-term property loans, increasing vulnerability to liquidity stress.

Hanoi and Ho Chi Minh City apartments remain expensive

Higher mortgage rates are hitting a market where housing prices are already elevated. Average apartment prices in the second quarter were about VND123 million per square meter in Hanoi and VND108 million in Ho Chi Minh City.

At those averages, a 60-square-meter apartment would cost roughly VND7.38 billion in Hanoi and VND6.48 billion in Ho Chi Minh City. The calculation is illustrative and does not account for location, project quality, down payments or transaction costs.

Some price adjustment has appeared in the secondary market. Land prices declined by about 2–3% during the second quarter, while secondary apartment and villa prices also softened in several areas. The declines have so far been modest relative to the rise in borrowing costs.

More homes are being approved, but most remain expensive

Vietnam's supply pipeline has expanded sharply. In the second quarter, 113 new commercial housing projects received construction permits, representing about 103,205 homes, including 69,588 apartments and 33,617 detached houses. The number of newly licensed projects was equivalent to 194.8% of the first-quarter level and more than three times the figure recorded a year earlier.

The composition of that supply remains a major constraint. About 25,500 apartments were newly launched in the second quarter. Luxury and ultra-luxury units priced from VND80 million per square meter accounted for 45% of the total, while another 37% was classified as high-end and generally priced above VND50 million per square meter. Mid-range housing represented 18%, while new affordable apartments priced below VND25 million per square meter were virtually absent, according to Vietnam Association of Realtors data published by VnExpress.

That means roughly 82% of newly launched apartments were in the high-end, luxury or ultra-luxury categories. The increase in total construction therefore does not automatically translate into more attainable homes for middle-income buyers.

Property transactions fall as inventories rise

The affordability squeeze is already visible in transaction data. Vietnam recorded about 100,005 successful real-estate transactions in the second quarter, equivalent to 71.5% of the first-quarter total and 63.7% of the level a year earlier. That represents a year-on-year decline of about 36.3%.

Apartment and detached-house transactions totaled 26,567, down 22.9% from a year earlier. Land transactions fell by about 40.1% to 73,438.

Developer inventories increased at the same time. Across 25 of the 34 provinces and cities that submitted data, unsold inventory totaled about 39,284 apartments, houses and land plots. Apartment inventory rose 22.2% from the previous quarter, detached houses 46.4% and land plots 25.4%, according to Vietnam's government portal.

For developers, weaker turnover means capital remains tied up in projects for longer while construction and debt-servicing costs continue.

Social housing is expanding but the gap remains

Vietnam is accelerating its social-housing program. During the first eight months of 2026, 108 projects containing 31,353 homes were completed and construction started on another 107 projects comprising 152,186 units.

By early September, the broader program covered 903 projects with 856,368 homes. Of those, 301 projects totaling 201,482 units had been completed, 314 projects containing 356,395 units were under construction or implementation and 288 projects covering 298,491 units had received investment approval. The Ministry of Construction said projects that were completed, started or approved represented about 85% of the investment target under the national social-housing plan.

Those figures should not be interpreted as homes currently available to buyers because a large share of the pipeline is still under construction or has only received investment approval. The program therefore cannot quickly rebalance the commercial housing markets of Hanoi and Ho Chi Minh City.

As International Investment experts report, the central risk for Vietnam's housing market is the widening gap between household income, property prices and the cost of borrowing. More project approvals can ease the supply shortage, but their impact on affordability will remain limited while new development is concentrated in expensive segments. If mortgage rates remain in double digits and transactions continue to weaken, developers face longer sales cycles and higher inventories, while banks will need to manage risks in a sector that already accounts for roughly a quarter of outstanding lending.

FAQ: Vietnam mortgages and housing market

What are mortgage rates in Vietnam in 2026?

Promotional fixed rates for the first 12 to 24 months averaged 10.9% across a sample of 11 banks in August. Broader real-estate lending rates were generally 12–14% in the second quarter, while floating rates after promotional periods could reach 13–15% and as much as 15–16% at some banks.

How much do apartments cost in Hanoi?

Average apartment prices were around VND123 million per square meter in the second quarter of 2026.

How expensive are apartments in Ho Chi Minh City?

The average apartment price was about VND108 million per square meter in the second quarter.

Are property prices falling in Vietnam?

There has been some moderate adjustment in the secondary market, but no broad decline large enough to restore affordability. Prices in the largest cities remain high and newly launched apartments are heavily concentrated in expensive segments.

Why has rising housing supply not improved affordability?

The price mix of new supply is the main issue. Around 82% of apartments launched in the second quarter were classified as high-end, luxury or ultra-luxury, while low-cost commercial apartments were almost absent.

What is happening to Vietnam property sales?

Successful real-estate transactions in the second quarter were about 36.3% below the year-earlier level. Developer inventories of apartments, houses and land plots increased at the same time.

Could Vietnam mortgage rates fall again?

Improving bank liquidity creates room for rates to stabilize, but it does not guarantee immediate cuts. The outlook will depend on banks' funding costs, deposit and credit growth, demand for capital and broader monetary conditions.