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People withdraw bank deposits to buy real estate   2012-04-19 - VTC

As commercial banks have lowered the deposit interest rate to 12 percent at maximum as per the request by the State Bank, people have withdrawn money to invest in other channels, because the deposit interests have become not attractive enough.

 
Experts believe it’s the right time to buy real estate

The real estate price has dropped to the deepest low, while experts believe the price is not likely to drop further.



Trinh Van Quyet, Chair of FLC Group, said that the real estate price has decreased by 30-40 percent from the highest peak. However, the price decreases have slowed down in recent months. Only a few of secondary investors have bargained products away to stop loss, other investors, who still can hold out, do not try to sell products at any costs.



The move by commercial banks to lower the ceiling deposit interest rate to 12 percent, has once more, prompted people to inject money in the real estate sector.



Nguyen Thi Hoa, who lives in Thanh Xuan district, said that though the real estate market remains gloomy, the investment in real estate products would bring profits in long term.



Previously, Hoa deposited money at bank, because she waited for the property prices to decrease further. However, Hoa believes that the current interest rate is not high enough to deposit money at bank any longer, and that it’s now the right time to invest in property, when the prices have become low enough.



Nguyen Van Minh, Director of Phat Dat Real Estate trade floor on Le Van Luong road, said that the number of people seeking to buy landed properties and apartments has increased slightly in recent days. Meanwhile, the number of successfully transactions has increased by 30 percent in comparison with one month ago.



The land plots in Van Quan and Xa La of Ha Dong district, the new urban area of Duong Noi in Hoai Duc district, prove to be the areas most targeted by investors.



Real estate have said that the interest rate reduction may not have big influences to enterprises, but would have big impacts on the feelings of investors and the people, who really want to buy houses for accommodation.



The lowering of the ceiling deposit interest rate to 12 percent and the banks’ commitments to lend at the reasonable interest rates of 15-16.5 percent both have made people believe that the real estate market would warm up again.



Dang Hung Vo, Deputy Minister of Natural Resources and the Environment, also thinks that the interest rate reductions would help ease the burden being put on real estate developers’ shoulders. However, he said comprehensive measures should be taken to ensure that the real estate prices would not be pushed up to overly high levels. If so, will the people, who have the real demand for accommodation, be able to buy real estate products at reasonable prices.



Also according to Vo, real estate developers cannot slash the real estate products’ prices because of the overly high construction costs. Therefore, in order to help enterprises ease difficulties, it’s necessary to reduce the long and medium term loan interest rates.



Dr Can Van Luc, a banking and finance expert, also said that real estate should be seen as a good investment channel for now. Real estate developers, who have been thirsty for capital, have to cut the prices by 30-40 percent, thus making real estate products cheaper than ever.



Luc also said that the stock market is warming up, which is really a good thing for the real estate market.



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