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Property developers seek new loan terms
The HCM City Real-Estate Association has petitioned the State Bank of Viet Nam to extend the terms of the debts owed by its members to banks.
Le Hoang Chau, the association’s chairman, said it had also asked the bank to reduce interest rates on old loans to currently prevalent levels to alleviate borrowers’ difficulties and review current rates to possibly scale them down further.
It wants banks to lend to property developers at below 10 per cent interest so that they can resume their projects, many of which have stalled, and to waive penal interest on overdue loans.
As of November 2008, in HCM City alone, banks’ outstanding loans to the property sector was VND61.2 trillion (US$3.5 billion).
Chau said last year was challenging for the industry and the situation would continue in 2009 because of the global economic crisis.
Only real-estate developers with deep pockets and sound strategies could survive it, he said. But with most developers in HCM City being small- or medium-sized, they had to rely on bank loans, he said, pointing out their projects would grind to a halt if they could not access bank loans.
He also urged property companies to work together to overcome the current difficulties. Since demand for low- and middle-income housing was still high, he said they should focus on these segments.
VietNamNet/VNS
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