Big 4 shockingly reduced to super cheap levels

Home purchase interest rates in January 2024 at Big 4 drop to super cheap levels

2023 is the journey of banks racing to reduce deposit interest rates. In the last days of 2023, this journey is "hotter" than ever with the "race" reserved for the Big 4 group (4 state-owned banks including Vietnam Joint Stock Commercial Bank for Foreign Trade - Vietcombank, Vietnam Joint Stock Commercial Bank for Investment and Development - BIDV, Vietnam Joint Stock Commercial Bank for Industry and Trade - VietinBank and Vietnam Bank for Agriculture and Rural Development - Agribank).

In particular, Vietcombank attracted attention when it brought its mobilization interest rate down to a record low, only 1.9%/year for 1-month and 2-month terms; 3.2%/year for 6-month terms and 4.8%/year for terms of 12 months or more.

At the remaining units of the Big 4 group, the highest rate is only 5.3%/year. This is the basis for Big 4 to deeply reduce lending interest rates in general and home loan interest rates in particular.

Home loan interest rates in January 2024 for the Big 4 group dropped to super cheap levels, image 1 — Home loan interest rates in January 2024 were pushed down to a new, lower level. Notably, the Big 4 group has shockingly reduced rates to super cheap levels. Illustrative photo

Therefore, the home loan interest rate in January 2024 has a much deeper decrease rate than the general market level.

From December 2023, BIDV's home loan interest rate will decrease by 1%/year to only 6.5%/year. This is a very low rate. In January 2024, Vietcombank will lower the interest rate to 6.7%/year.

The rate of 6.7%/year at Vietcombank is fixed for the first 18 months, then increases to 6.8%/year for the next 2 years and 7.5% (for 3 years), 9.5% (for 5 years), 10.5% (for 7 years), after 10 years, the fixed interest rate is 11%/year. After the preferential period, the loan interest rate is calculated by the 12-month savings interest rate plus a margin of 3.5%.

The highest rate in the Big 4 group belongs to Agribank with 7%/year, the lowest rate belongs to VietinBank with 6.4%/year.

It can be seen that the Big 4 group is increasingly giving more incentives to home loan activities.

VPBank is still the champion in cheap loans.

Meanwhile, the lowest home loan interest rate in January 2024 is being applied by Vietnam Prosperity Joint Stock Commercial Bank - VPBank at 5.9%/year. Following are UOB Bank (6%/year), Global Petroleum Bank - GPBank (6.25%/year), VietinBank (6.4%/year), BIDV (6.5%/year), Saigon Thuong Tin Commercial Joint Stock Bank - Sacombank (6.5%/year), Shinhan Bank (6.6%/year), Vietcombank (6.7%/year), Ho Chi Minh City Development Joint Stock Commercial Bank - HDBank (6.8%/year), Vietnam Maritime Commercial Joint Stock Bank - MSB (6.8%/year), Tien Phong Commercial Joint Stock Bank - TPBank (6.9%/year),...

On the other hand, Vietnam Technological and Commercial Joint Stock Bank – Techcombank has the highest interest rate but is still quite “comfortable”, reaching 10.5%/year. Following are HSB (9.75%/year), Southeast Asia Commercial Joint Stock Bank – SeaBank (9.29%/year), Orient Commercial Joint Stock Bank – OCB (8.49%/year),…

At a recent press conference to deploy the State Bank's (SBV) 2024 tasks, Permanent Deputy Governor Dao Minh Tu said that interest rates have hit a 20-year low and the SBV will strive to lower interest rates even further.

Home loan interest rates drop sharply after 1 year

After a year of "plummeting" deposit interest rates, home loan interest rates have also dropped sharply, although the decline has not been really proportional.

Currently, there is only one bank with a home loan interest rate of over 10%, but a year ago, this list was extended to Hong Leong Bank (13%/year), Shinhan Bank (10.9%/year), UOB (10.7%/year), Techcombank (10.59%/year), Woori Bank (10%/year), VPBank (10%/year),...

After 1 year, home loan interest rates at Shinhan Bank decreased by 4.94%/year. The decrease at UOB was 4.7%/year, at VPBank was 4.1%/year, at Woori Bank was 2.8%,...

However, on the contrary, some units no longer apply the super preferential rate. Previously, MSB had an interest rate policy of only 4.99%/year. The lowest rate at Vietnam Public Joint Stock Commercial Bank - PVComBank and TPBank is only 5%/year and 5.9%/year.

However, the super preferential rates for home buyers that MSB, PVComBank and TPBank applied a year ago were only effective for a short time, only for the first few months. After that, the floating interest rate usually fluctuated from 13% to 15%/year. Currently, this policy is no longer applied.

Although home loan interest rates have dropped sharply, the real estate market remains gloomy.

According to the 2023 Housing Real Estate Market Report for Ho Chi Minh City and its vicinity, recently announced by DKRA Group on January 5, the market recorded many fluctuations in supply and consumption in most segments last year.

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