Vì sao người trẻ KHÔNG THỂ MUA NỔI NHÀ? | Thành Nguyễn

The Housing Crisis for Young Vietnamese: A Systemic Analysis

Key Concepts:

• Điểm chuyển pha (Phase Transition): The point at which a substance changes state (e.g., water to steam), analogous to housing shifting from a need to a financial asset.
• Rút ruột nền kinh tế (Economic Drain): The diversion of capital from productive sectors (manufacturing, innovation) into real estate.
• Hiệu ứng khóa cửa (Lock-in Effect): The inability to change a system due to interconnected dependencies and vested interests.
• Vòng xoáy (Spiral/Cycle): Self-reinforcing loops that exacerbate problems, both at the individual and economic levels.
• Tỉ lệ giá nhà trên thu nhập (House Price-to-Income Ratio): A key metric indicating housing affordability.
• Too big to fail/save: A situation where an entity is so large and interconnected that its failure would have catastrophic consequences, but also too large to be effectively rescued.

I. The Global Phenomenon: Housing Beyond Reach

The author, Thành Nguyễn, begins by noting the traditional Vietnamese proverb linking homeownership to life milestones ("tậu châu cưới vợ làm nhà"). However, this aspiration is increasingly unattainable for young Vietnamese, mirroring a global trend. While previous generations could purchase a home within 3 years of income, current generations face a staggering 23 years – and potentially a lifetime – even with complete savings. This isn’t simply a matter of youthful extravagance or low wages; it’s a systemic issue.

The problem isn’t unique to Vietnam. The author points to similar struggles in the US, UK, Australia, Japan, and South Korea, indicating underlying global mechanisms at play. Historically, house prices and income grew in tandem. However, house prices have begun to outpace income dramatically. In developed countries, the house price-to-income ratio has risen from 2-3 in the 1960s-80s to 5-7 today. This means houses are fundamentally more expensive relative to earnings.

II. The Shift in Housing’s Role: From Need to Asset

The author explains a fundamental shift in the perception and function of housing. Previously, a home was primarily a place to live ("chỗ trú mưa trú nắng"). Now, it’s predominantly viewed as a financial asset. This transformation occurred gradually, akin to a “phase transition” in physics. When the return on investment in real estate (10-15% annually) surpasses other investment options (e.g., 5% savings interest), a self-perpetuating cycle begins. Demand increases, driving up prices, attracting more investors, and so on. This cycle lacks a natural brake.

III. The Paradox of Cheap Money

Low interest rates, counterintuitively, don’t make homeownership easier. While lower rates allow individuals to borrow more, they also increase demand, enabling sellers to raise prices. The benefit of cheap money doesn’t flow to buyers but to existing property owners. When interest rates subsequently rise, a difficult situation arises: high prices remain, and borrowing becomes more expensive, further restricting access. Furthermore, existing homeowners with low-interest mortgages are reluctant to sell, creating a “lock-in effect” and constricting supply. This phenomenon is already being observed in the US and other developed nations.

IV. The Vietnamese Context: An Economy Riding on Real Estate

Vietnam’s situation is particularly acute due to the economy’s heavy reliance on the real estate sector. Unlike other countries, the dependence extends beyond individual buyers to encompass the government, banks, and large enterprises.

• Local Governments: Land-related revenue (land allocation, leases, auctions) accounts for 15-30% (and up to 40-50% in some provinces) of local government budgets. This creates a conflict of interest: governments are incentivized to maintain high land prices and restrict supply to maximize revenue, hindering affordable housing initiatives.
• Banks: Approximately 21% of Vietnam’s total credit is allocated to real estate, potentially rising to 30-40% when including loans secured by property. This makes banks vulnerable to a decline in real estate values, as it would lead to a surge in non-performing loans. Credit for real estate investment has grown 18% annually, while credit for home purchases has only increased by 6.5%.
• Businesses: Investing in land is often more profitable and less risky than investing in manufacturing or innovation. This “economic drain” diverts capital from productive sectors, hindering industrial development and innovation. Many large Vietnamese corporations have a significant stake in real estate, not as a core business, but as a source of quick profits.

The author illustrates this interconnectedness with a metaphor of three people on a boat – the government, banks, and businesses – all reliant on rising land prices for their survival. None are willing to “jump off” (change the system) for fear of sinking the boat. This situation mirrors China’s experience 15-20 years ago, which is currently facing the consequences of its real estate-driven growth model.

V. Two Reinforcing Spirals

The author identifies two interconnected spirals exacerbating the housing crisis:

1. Individual Spiral: High prices prevent young people from buying, forcing them to rent, driving up rental costs, making saving difficult, and perpetuating the cycle.
2. Economic Spiral: Economic growth relies on real estate, necessitating rising land prices. Policies favor real estate, attracting capital away from productive sectors, further increasing the economy’s dependence on real estate.

These spirals are not independent; the economic spiral fuels the individual spiral. The system is complex, lacking a single cause or solution. Attempts to address one aspect can worsen others. For example, increasing social housing supply may be hampered by local governments’ revenue concerns.

VI. Data and Comparisons

• Vietnam’s House Price-to-Income Ratio: 23.7, significantly higher than China’s peak and exceeding levels in developed countries.
• China’s Land Revenue as a Percentage of Local Budgets: 40-50% (previously).
• China’s Real Estate Credit as a Percentage of Total Credit: 25-30%.
• Evergrande’s Debt: $300 billion.

VII. Conclusion & Implications

The author concludes that young Vietnamese people are unable to afford homes not due to personal failings (extravagance, laziness) but due to a deeply flawed system. The situation is not merely an individual problem but a systemic one. The consequences are significant: delayed family formation, accelerated population aging, and potential economic stagnation.

While the government is attempting to address the issue through social housing programs, these are insufficient to fundamentally alter the system. A long-term solution requires a structural shift towards a more balanced economy that doesn’t rely solely on real estate for growth. The author draws parallels to China and other Asian nations, warning of potential consequences if the current trajectory continues. The need for systemic restructuring is urgent, but the path forward remains unclear.