In late February 2026, the Prime Minister requested strict control of credit for speculative real estate. At the beginning of the year, the State Bank of Vietnam required credit institutions not to let real estate outstanding debt grow faster than their own general growth rate; if exceeded, credit room could be cut.

The message is quite clear: Despite the 10 percent growth goal, capital flows must not continue to be poured into land as strongly as last year.

The year 2025 ended with figures that could easily excite the property market. Total credit in the banking system increased by more than 19 percent, but credit for real estate business surged by as much as 28 percent. Outstanding loans to real estate accounted for 24 percent of the economy’s total credit. In other words, out of every four dong of bank lending, nearly one dong flowed into real estate.

At the same time, revenue from land soared. Nationwide revenue from houses and land reached about VND575,500 billion, nearly double the estimate and accounting for 22 percent of total state budget revenue.

Hanoi collected nearly VND108,000 billion from land in 2025, accounting for about 15 percent of the city’s total budget revenue, while the figure is expected to reach VND150,000 billion in 2026, nearly 40 percent higher. 

Quang Ninh recorded land-use revenue of VND26,460 billion, far exceeding projections and rising more than 1,200 percent year on year; one large project alone contributed more than VND16,000 billion to the provincial budget. HCMC also collected about VND78,482 billion from land, more than 170 percent above the target assigned by the central government.

One may think that the monetary policy is moving against growth and revenue. But the issue is not a policy contradiction. The problem is that growth based on land has pushed financial leverage close to the limits of tolerance.

The pressure is most visible in bank liquidity.

Credit has grown rapidly while deposit mobilization has not kept pace. Some analysts estimate that the loan-to-deposit ratio by the end of 2025 approached 110 percent. Overnight interbank interest rates at times exceeded 9 percent. After the Lunar New Year, lending rates for real estate at some banks rose to 14–15 percent. Banks have had to raise deposit rates to attract capital or rely on the interbank market to cover liquidity.

Leverage is stretched tight like a string. If a major borrower, which is mostly from the real estate sector, runs into cash flow trouble, risks could spread very quickly. Therefore, tightening capital safety standards and controlling the pace of credit growth is not about stepping on the brakes of growth. It is about reinforcing the system’s shock absorbers before entering the next stage.

Another detail is also worth considering. According to the Vietnam Association of Realtors, more than 75 percent of recent housing transactions came from buyers purchasing a second or subsequent home. About 10 percent are investors using short-term financial leverage to rotate capital. This shows that the market is no longer mainly about housing needs but increasingly about asset accumulation and investment.

When the cost of capital is low, the cycle can run smoothly. But when interest rates edge upward and liquidity tightens, those using leverage will face pressure first. If that pressure spreads widely, the impact will not stop with a few investors but could bounce back toward the banking system.

On the fiscal side, pressure is also considerable.

Revenue from land reached a record, but that is a one-time revenue. When auctions are favorable and projects are cleared, the budget soars. But if the market stalls, that revenue source can drop very quickly. When the budget relies heavily on land, the budget is tied tightly to the real estate cycle.

The most dangerous thing is when two downward rhythms coincide: The market slows down exactly when the banking system must handle bad debts. At that time, pressure will pile onto both fiscal and financial sectors.

Vietnam has set a target of double-digit growth for the 2026–2030 period, with expectations of improving productivity, expanding manufacturing and processing, strengthening the digital economy, and enhancing the quality of growth. But if capital continues to flow mainly into assets rather than production, 10 percent growth could simply reflect inflated asset values rather than real productivity gains.

Tu Giang