Is it time for young people to 'put down money' to buy their first home?

Beware of financial pressure

Talking about the first home purchase of young customers, Dr. Su Ngoc Khuong, Senior Director of Investment Consulting Savills Vietnam, said that a feasible solution is that when people have just started a family and are not facing great pressure on housing, they can look for flexible real estate solutions.

“In the period of 3-5 years after marriage and before having children, they may not need to own a house immediately. Instead, they can invest in an apartment or townhouse with an initial payment rate of 30-50%, and the rest they borrow from the bank,” said Dr. Su Ngoc Khuong.

For those who need to own immediately, the expert said they can choose to buy an apartment or townhouse, but this requires them to pay the full value 100%. They can use part of the cash and borrow the rest from the bank, then use their monthly income to pay both the principal and interest, to own their home.

Experts say young people should consider many factors before buying a house, including financial pressure and the real need to own a home.

With real estate products being formed in the future, buying a house in progress can be a positive choice for young couples. Instead of saving in the bank with low interest rates, they can invest in apartments that will be formed in the future.

“You can put money down to buy a house according to your progress and needs. Although the immediate need may not arise, after 2-3 years, the need for housing becomes more necessary, and this can be a positive solution,” added the Savills expert.

However, when implementing this plan, Mr. Khuong emphasized that there are a number of things to consider.

First, we need to determine whether we really need housing. Second, we need to assess the amount of savings we have. Third, we need to consider our borrowing capacity and ask ourselves whether our monthly income is enough to pay both principal and interest.

“For renters, the desire to own a home is often very strong, however, it is necessary to approach this issue carefully and cautiously, while improving financial tolerance,” Mr. Khuong added.

Seize the market recovery moment

In the broader picture, Savills experts believe that the housing market will not be able to recover strongly next year due to a period of stagnation that has lasted from the end of 2022 until now. Ms. Giang Huynh, Deputy Director, Head of Research and S22M Savills Ho Chi Minh City, believes that factors affecting the market may continue next year, such as cash flow difficulties and pressure to repay bonds of investors, low liquidity, and affected buyer psychology.

“However, the housing market is expected to gradually recover thanks to the Government's efforts in promoting public investment, infrastructure development and transparency in real estate business activities,” said the Deputy Director of Savills.

Ms. Giang Huynh, Deputy Director, Research & S22M Department, Savills HCMC

Ms. Giang also believes that as the economic center of the Southern region, where there is a large demand for housing, real estate in Ho Chi Minh City will recover first, followed by neighboring provinces such as Binh Duong and Dong Nai.

From a supply perspective, Ms. Giang Huynh said that the supply expected to gradually recover from next year is also expected to be a big driving force for the market next year. Some projects in Ho Chi Minh City currently also offer a 24-month payment package with only 20% of the initial purchase contract value.

“According to Savills Vietnam data, in 2024, the future supply in Ho Chi Minh City will have more than 16,000 apartments and more than 2,000 villas/townhouses. Neighboring provinces such as Binh Duong and Dong Nai with large land funds will have more than 6,000 villas/townhouses and more than 9,000 apartments,” said Ms. Giang.

In terms of project development, experts believe that if investors can implement projects on schedule, with reasonable selling prices and transparent legal procedures, they will be able to attract buyers and gradually restore market liquidity. The government’s responsibility to remove legal difficulties for real estate projects also plays a key role in supporting market recovery.

Source: https://www.congluan.vn/da-den-luc-nguoi-tre-xuong-tien-mua-can-nha-dau-tien-post276231.html