The Vietnamese real estate sector is facing increasing capital costs, with many businesses issuing bonds at average interest rates exceeding 12%. Data from the Hanoi Stock Exchange (HNX) shows that in August, real estate companies offered four bond lots to raise nearly 4,000 billion VND. The average issuance interest rate was approximately 12,2%, one percentage point higher than the previous month and over four points higher than bank bonds. This trend reflects a tightening credit market and rising refinancing risks for developers.
Leading the recent issuances, Vinhomes secured 3,000 billion VND through two bond lots, offering interest rates of 11% and 12,5% respectively. Kinh Bac followed, raising 700 billion VND over three years with a 12% interest rate for the initial period. TandoLand, a real estate company based in Tay Ninh, further increased its interest rate to 13%, one percentage point higher than its issuance two months prior. Looking at recent months, most real estate corporate bonds offer 11-12,5% interest per year, with some Khai Hoan Land Group lots issued early this year reaching 13,5%.
Ms. Pham Thai Thanh Truc, Director of Real Estate Sector Analysis at ACB Securities Company (ACBS), noted that real estate bond interest rates have significantly increased compared to the period before 2026. The floor for floating interest rates, previously ranging from 9,5-10%, is now higher. "This significantly increases the refinancing risk for real estate businesses," Ms. Truc stated. Refinancing risk is the possibility that a business cannot borrow new funds to repay or replace old debts when they mature, potentially leading to a liquidity shortfall or loss.
According to Ms. Truc, real estate businesses also face risks from maturing bonds and early redemptions. These factors drive up project development costs, impacting profits and putting pressure on selling prices. FiinGroup, in a report published late last month, projected a gradual increase in real estate bond payment obligations in the final months of the year. Principal debt due in the next four months is approximately 52,000 billion VND, with interest debt around 18,000 billion VND, both peaking in December.
S&I Ratings indicates that corporate bonds will continue to serve as a capital-filling mechanism for real estate businesses, especially as real estate business credit remains controlled. This channel offers businesses flexibility in terms and asset structure. Projects with sufficient legal standing and high credit-rated businesses can negotiate lower interest rate margins or tiered interest rate structures, providing a cost of capital advantage over current bank loan rates. Conversely, developers with weak financial foundations, high leverage ratios, and illiquid project portfolios face greater risks in capital turnover. This situation will naturally filter out weaker developers in this new phase.
Phuong Dong
