Financing options for foreigners when buying property in Vietnam

Homebase-a proptech based in Vietnam makes homeownership a dream come true for local and foreign owners that struggle to obtain a mortgage.

The Vietnamese real estate industry will continue to thrive in 2021 and beyond once COVID-19 recovery is fully underway. It’s no surprise that Vietnam is becoming an attractive playground for investment now that foreign investors are flocking in. One problem prevails, though: How can foreigners own property in Vietnam given limited financing options?

Related: Check out Cekindo Business Registration Services in Vietnam

Foreign buyers can seek financing from banks/financial firms (local and international), or simply work with a third option that offers a more flexible path. Homebase, a prop-tech company that presents an alternative to owning houses in Vietnam, is one of the market’s leaders. They are backed by multibillion-dollar funds from Vietnam (VinaCapital – a three-billion-dollar capital venture that is one of the country’s largest) and throughout the world (Antler, Y Combinator, and more). Their business model is similar to that of DivvyHomes and ZeroDown, two extremely successful real estate firms in the United States. Homebase has also raised $30 million in investments to make homeownership a reality for buyers in the Southeast Asian market.

Homebase stands out for its ability to service homebuyers quickly and efficiently, as well as serving a more varied customer base than traditional banks.

How to qualify for property loans in Vietnam?

Foreign buyers are allowed to own homes in Vietnam, but the lending requirements are significantly tougher than for local buyers:

  • You must be a Vietnamese, Viet Kieu, or a foreigner married to a Vietnamese.
  • You must be under the age of 65 at the end of the loan period.
  • A regular monthly income of 5 million VND is required.
  • You shall have stable employment.

Similar to most Southeast Asian countries, foreigners cannot own land in Vietnam due to property laws. The land is considered a collective asset for all Vietnamese in the country. 

How to apply for mortgages in Vietnam as foreigners

To begin owning property in Vietnam, you can choose from one of the following:

  1. Apply for regular bank mortgages (which have stricter conditions than for local purchasers) or just purchase the property in cash since most transactions in Vietnam are done this way.
  2. Seek assistance from financial service providers overseas.
  3. Look for alternatives to typical banking methods.

However, foreign corporations are not always willing to assist foreigners because they may lack an understanding of the market. In this case, you can turn to other services that are more knowledgeable and experienced in serving foreign purchasers.

How Homebase helps with foreign property ownership

Homebase is one of these options. What’s great about them is that they’ll do most of the hard work to lessen the stress of home buying. To work with Homebase, you’ll only have to follow these easy steps:

  1. Customers select a property or Homebase can suggest an agent to help.
  2. If the property passes inspection, Homebase will pay for it in cash.
  3. Customers make a deposit of at least 20% in the beginning.
  4. Customers pay a fixed monthly amount until the end.
  5. Customers can buy the property back or walk away from it.

View the infographic below to better understand how it works:

Financing home in Vietnam

Read more: Visa Application to Enter Vietnam in 2021, an updated guide

Why Homebase is a better option than traditional banking

Homebase makes property ownership possible by minimizing buyers’ efforts in the process. They provide a flexible payment plan, require a minimum deposit amount, and handle the paperwork almost entirely. This way, Homebase can substantially reduce the time spent on working back-and-forth with bank representatives for you. This is definitely good news for foreign owners who might be unfamiliar with the Vietnamese real estate market and how it works.

The following is a comparison between Homebase’ benefits and typical bank options:

Financing options for foreigners when buying property in Vietnam

Closing thoughts

With these advantages, Homebase has proven to be a strong competitor in the real estate market. They understand the difficulties to get a loan for underserved customers, and so offer a more flexible path to own property in Vietnam. 

Foreigners who struggle to obtain mortgages can turn to Homebase to expedite their property ownership. Whether you’re a foreign buyer who finds it difficult to meet loan criteria or an investor who gets shunned by the local banks, Homebase can help to customize a plan that works best for you.

Contact Our Consultant

Tomas Svoboda - Cekindo - Vietnam Country Manager

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Ing. Tomas Svoboda

Tomas is an expansion manager responsible for Vietnam. His role is to define the key potential of the Vietnamese market and to ensure that Cekindo branch in Vietnam provides its clients with smooth and hassle-free market entry solutions.