I have about 1.3 billion VND in savings and am looking for land or a level-4 house in a province near Ho Chi Minh City, where I live with my parents. I want to acquire this property before getting married. My current monthly salary is 31 million VND, and I contribute about 4 million VND to household expenses.

What property price should I consider to ensure a safe loan from the bank?

Tran Trang (29 years old)

A corner of the eastern part of Ho Chi Minh City's core area facing the Dong Nai River, 2/2025. Photo: Quynh Tran

A corner of the eastern part of Ho Chi Minh City's core area facing the Dong Nai River, 2/2025. Photo: Quynh Tran

Expert Advisor:

First, congratulations on having a solid financial foundation with 1.3 billion VND in savings and a good monthly income of 31 million VND. This is not something everyone achieves at the age of marriage.

However, buying a house at this time still needs careful consideration to avoid impacting your financial future after marriage. Here are some principles to keep in mind for your land or house purchase plan.

Firstly, determine a "safe" house or land price based on your existing capital. With 1.3 billion VND, you should prioritize properties within the 1.3-1.6 billion VND range. If you find a house or land around 1.3 billion VND, you can avoid borrowing entirely, while setting aside 100-150 million VND for transfer fees, repairs, or contingency funds.

If you want to buy a more expensive property, ensure the loan ratio does not exceed 30-40% of the property value, meaning the total price shouldn't exceed 1.9-2.1 billion VND.

The second principle is "safe debt repayment," not exceeding 35% of your monthly income. Suppose you want to borrow an additional 700 million VND to buy a 2 billion VND house. With an interest rate of around 9% per year and a 15-year repayment period, your monthly payment will be nearly 7 million VND, including both principal and interest. With your income of 31 million VND, after deducting 4 million VND for household expenses, you have 27 million VND left. Of this, you should allocate a maximum of 10 million VND (equivalent to about 35%) for loan repayment.

You should research banks offering the most preferential loan packages to benefit from favorable interest rates. In particular, consider home loan packages for young people under 35 offered by commercial banks, with good interest rates of 5.5% per year fixed for the first three years. Opt for the longest possible loan term to avoid short-term cash flow pressure.

With the remaining 17 million VND, I suggest saving, insurance, investment, and always allocating a portion for personal development or other unexpected expenses. Additionally, explore other investment channels like equity mutual funds, bonds, ETFs, and stock accumulation for beginners to diversify your portfolio, avoiding putting all your eggs in one basket. At the right time, you can use these investments to pay off your loan.

Therefore, a loan under 800 million VND is a safe level for you. However, ideally, borrow less than 500 million VND if you want a lighter burden after getting married.

I also want to highlight the factors of liquidity and price appreciation potential. As this is your first pre-marital asset, serving not only as a residence but also a long-term investment, choose a property with good liquidity, near administrative centers, in a stable residential area, and easy to buy and sell if you need to access your capital later.

We suggest some areas near Ho Chi Minh City's core within your budget. Firstly, Di An, Thuan An, Ben Cat, and Tan Uyen are 30-40 minutes' drive from the city center, with many densely populated residential areas and well-developed infrastructure. Secondly, Long Thanh and Nhon Trach (Dong Nai), near Long Thanh Airport, have rapidly developing infrastructure and still offer good prices. Thirdly, Ben Luc and Duc Hoa (Long An), bordering Binh Chanh, still have many land or house options under 2 billion VND.

Furthermore, maintain a financial reserve. After buying the property, keep at least 3-6 months of living expenses for contingencies like illness, unemployment, or marriage. Add 3 months of principal and interest payments to this reserve if you have a loan. For you, this reserve should be at least 50-100 million VND if you have a loan, and it should be kept in a 1-6 month savings account for immediate access when needed.

Next is health and financial protection, including health insurance and social insurance, which you likely already have through your company. In addition, a life insurance policy with a premium of 5-8% of your income (equivalent to 1.5-2.5 million VND per month) is reasonable if you don't already have one. This is a safety net for your health and finances.

Preparing assets before marriage is commendable. But remember, risk management is more important than seeking profit. Buy a property within your means, with good liquidity, without over-borrowing, and maintain financial flexibility for the future. If you have any further questions about buying a house or land, don't hesitate to consult with personal financial advisors. They will guide you from the planning stage to negotiating the best purchase price.

Lai Thi Thanh Nga

Financial Advisor

FIDT Investment Consulting and Asset Management Company