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Vietnamese law requires all property transactions to be conducted in Vietnamese dong (VND), not US dollars (USD).
As of September 2025, the USD/VND exchange rate stands at approximately 26,388 VND per dollar, and the dong has depreciated by 2-4% annually over recent years. Foreign investors must navigate currency conversion costs, legal restrictions, and exchange rate risks when purchasing Vietnamese real estate, as all contracts, payments, and taxes must be settled in VND despite occasional USD pricing for marketing purposes.
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All Vietnamese property transactions must legally be conducted in VND, regardless of how properties are initially marketed to foreign buyers.
The dong has depreciated approximately 10-15% against the USD over the past five years, exposing foreign investors to significant currency risk.
| Currency Aspect | USD | VND |
|---|---|---|
| Legal Transaction Status | Not permitted for property deals | Legally required for all transactions |
| Financing Availability | Rare, only for enterprises | Standard for residential purchases |
| Tax Payments | Not accepted | All taxes must be paid in VND |
| Exchange Rate Risk | Lower but legally impossible | High exposure to depreciation |
| Transfer Costs | Conversion fees plus penalties | Direct transfer with no conversion |
| Property Registration | Cannot register title in USD | Required for title registration |
| Long-term Viability | Not legally possible | Subject to inflation and devaluation |
What is the current USD to VND exchange rate?
As of September 2025, one US dollar equals approximately 26,388 Vietnamese dong.
The USD/VND exchange rate has shown a steady upward trend over recent years, rising from around 23,000 VND per dollar in mid-2020 to current levels above 26,000. This represents a gradual weakening of the Vietnamese dong against the US dollar.
UOB Bank forecasts the exchange rate to remain within the 25,800 to 26,300 VND per USD range through early 2026. The State Bank of Vietnam maintains active intervention in currency markets to prevent excessive volatility, which helps keep fluctuations relatively controlled compared to other emerging market currencies.
Major Vietnamese banks like Vietcombank and Eximbank update their exchange rates multiple times daily, with slight variations between institutions. The official rate set by the State Bank of Vietnam serves as the reference point for all banks operating in the country.
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How stable has the USD/VND exchange rate been over the past few years?
The Vietnamese dong has depreciated by 2-4% annually against the US dollar over recent years, showing moderate but consistent weakness.
From 2020 to 2025, the dong lost approximately 10-15% of its value against the dollar, which translates to an average annual depreciation of 2-3%. This depreciation has been relatively gradual compared to other Southeast Asian currencies, reflecting Vietnam's managed exchange rate policy.
The State Bank of Vietnam employs a managed float system where the dong is allowed to fluctuate within predetermined bands. This approach has prevented sharp devaluations but hasn't stopped the long-term weakening trend driven by trade deficits, inflation pressures, and global market conditions.
Periodic adjustments occur due to external factors like Federal Reserve interest rate changes, global commodity prices, and Vietnam's trade balance. However, the central bank's intervention typically prevents daily fluctuations from exceeding 1-2%.
This stability comes at the cost of gradual depreciation, making it predictable for planning purposes but still representing a consistent erosion of dong value for USD-based investors.
Are there restrictions on using foreign currencies for property transactions?
Vietnamese law strictly prohibits using foreign currencies, including USD, for domestic property transactions.
| Transaction Type | USD Allowed | Legal Requirement |
|---|---|---|
| Property Purchase Contracts | No | Must be denominated in VND |
| Down Payments | No | VND payment required |
| Final Settlement | No | All payments in VND only |
| Property Registration | No | VND values recorded in title |
| Rental Agreements | Limited exceptions | Generally VND required |
| Property Taxes | No | All taxes paid in VND |
| Legal Documentation | No | All contracts in VND |
How do developers typically price properties - in USD or VND?
Vietnamese developers primarily price properties in VND for all legal documentation, though some may show USD prices for foreign marketing purposes.
Property advertisements targeting foreign buyers occasionally display prices in both currencies, with USD figures serving as reference points for international investors. However, these USD prices are purely indicative and have no legal standing in actual transactions.
All binding contracts, purchase agreements, and official documentation must specify prices in Vietnamese dong. Developers who attempt to enforce USD pricing in contracts face significant legal penalties, including fines ranging from 10 million to 100 million VND.
The practice of showing USD prices stems from marketing convenience for foreign buyers who may think in dollar terms, but the conversion to VND must occur at the time of contract signing using the prevailing exchange rate.
High-end developments in Ho Chi Minh City and Hanoi sometimes market to international buyers with USD reference pricing, but the legal reality remains that all transactions conclude in VND regardless of initial marketing materials.
What are the costs of using USD versus VND for property transactions?
Using USD for Vietnam property purchases creates additional costs through mandatory currency conversion and potential legal penalties.
Foreign buyers sending USD to Vietnam face several layers of costs. Banks typically charge 0.5-1.5% for international wire transfers, plus conversion spreads of 1-3% when converting USD to VND. Vietnamese receiving banks may add additional fees of 0.1-0.5% for processing foreign currency transfers.
The total cost of converting USD to VND for property purchases typically ranges from 2-5% of the transaction value when accounting for all fees, spreads, and charges. This represents a significant additional expense on top of standard property transaction costs.
Direct VND transfers between Vietnamese banks incur minimal fees, usually under 0.1% of the transaction value. This makes VND transactions substantially more cost-effective for buyers who can arrange funding in the local currency.
Legal violations involving USD usage in property contracts carry fines from 10 million to 100 million VND, adding further financial risk to attempts at circumventing currency regulations.
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How do exchange rate fluctuations impact property value over time?
Exchange rate fluctuations create significant impact on property values for foreign investors, as Vietnamese real estate values fluctuate with the dong's performance against major currencies.
Over the past five years, the dong's 10-15% depreciation against the USD means that property values have declined by equivalent amounts when measured in dollar terms, regardless of local market performance. A property purchased for 2.3 billion VND in 2020 (equivalent to $100,000 then) would be worth approximately $87,000-90,000 in September 2025 due to currency depreciation alone.
This currency impact compounds with local property market movements. If local prices rise by 5% annually but the dong depreciates by 3% annually, the net USD return is only 2% per year before considering rental yields and transaction costs.
Long-term holding periods amplify currency risk. The consistent 2-4% annual dong depreciation means that foreign investors lose purchasing power over time even if local property values remain stable or grow modestly.
Currency hedging options for individual property investors in Vietnam are extremely limited, leaving most foreign buyers exposed to full exchange rate risk throughout their ownership period.
Is financing easier to obtain in USD or VND?
Financing for Vietnamese property purchases is almost exclusively available in VND, with USD-denominated loans restricted to qualifying enterprises only.
Vietnamese banks offer residential mortgages primarily in VND, with interest rates typically ranging from 8-12% annually depending on the borrower's profile and down payment. Foreign buyers face additional restrictions and often require larger down payments of 30-50% compared to local buyers.
USD-denominated loans exist mainly for large corporations and specific business purposes, not residential property purchases. The few USD loans available typically require substantial collateral and are limited to enterprises with foreign currency revenues.
Most foreign property buyers in Vietnam purchase with cash rather than financing due to the limited availability of mortgages for non-residents. This cash requirement means buyers must convert their entire purchase amount from foreign currency to VND upfront.
The State Bank of Vietnam caps USD deposit interest rates at 0% for individuals, making VND deposits more attractive despite currency risk, as VND deposit rates can reach 6-8% annually.
What are the tax implications of using USD versus VND?
All property-related taxes in Vietnam must be calculated and paid in VND, with no option for USD payments.
1. **Value Added Tax (VAT)**: 10% of property value, payable in VND only2. **Registration Tax**: 0.5% of declared property value in VND3. **Maintenance Tax**: 2% annually on property value in VND4. **Personal Income Tax on Sale**: 2% of sale price in VND for foreigners5. **Transfer Tax**: Various rates depending on holding period, all in VNDTax authorities use the VND value declared in purchase contracts for all calculations. If original purchase involved currency conversion, the VND amount recorded in legal documents becomes the tax basis, not any USD equivalent value.
Capital gains calculations for tax purposes use VND purchase and sale prices, meaning currency fluctuations can create additional tax complexity. A property that maintains stable USD value but appreciates in VND terms due to currency depreciation may trigger higher capital gains taxes.
Foreign investors cannot claim currency conversion costs or exchange rate losses as deductible expenses for Vietnamese tax purposes. All tax obligations are based purely on VND transaction values.
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Do foreign investors generally prefer USD or VND for property purchases?
Foreign investors typically prefer to think in USD terms for planning purposes but must accept VND transactions due to legal requirements.
International buyers often request USD pricing for initial discussions and investment analysis, as it allows easier comparison with other global real estate markets. Many foreign investors calculate returns, financing needs, and investment decisions using USD as their base currency.
However, the legal reality forces all foreign investors to transact in VND regardless of their preferences. This creates a disconnect between planning (often in USD) and execution (required in VND), which sophisticated investors account for in their investment models.
Marketing materials from Vietnamese developers often cater to foreign preferences by showing both currencies, but experienced international investors understand that VND is the only legally binding currency for actual transactions.
The preference for USD thinking combined with VND transaction requirements means foreign investors must continuously monitor exchange rates and factor currency risk into their investment decisions throughout the ownership period.
How does the Vietnamese government regulate foreign currency usage in property investments?
The State Bank of Vietnam strictly regulates foreign currency usage in property investments through comprehensive legal frameworks and enforcement mechanisms.
The Foreign Exchange Ordinance and related regulations prohibit using foreign currencies for domestic transactions, including all aspects of property purchases. These restrictions apply to contract pricing, down payments, final settlements, and ongoing property-related expenses.
Authorized exceptions exist only for specific sectors like international trade, foreign loans to qualifying enterprises, and designated special economic zones. Residential property purchases do not qualify for any exceptions to the VND requirement.
Enforcement includes regular audits of property transactions, financial institutions, and real estate developers. Violations can result in administrative fines, criminal charges for serious breaches, and cancellation of business licenses for companies.
The government's policy aims to maintain monetary sovereignty, prevent dollarization of the economy, and ensure effective implementation of monetary policy. These objectives take precedence over foreign investor convenience in currency choices.
How do I assess the long-term viability of holding property in USD versus VND?
Long-term viability assessment must focus on VND holdings since USD property ownership is not legally possible in Vietnam.
| Assessment Factor | 5-Year Outlook | Risk Level |
|---|---|---|
| VND Depreciation Trend | Continued 2-4% annual decline | High |
| Vietnam GDP Growth | 6-7% annually projected | Medium |
| Property Price Growth | 5-8% annually in major cities | Medium |
| Inflation Impact | 3-5% annually expected | Medium |
| Rental Yield Stability | 4-6% gross yields anticipated | Low |
| Currency Hedging Options | Limited for individuals | High |
| Exit Liquidity | Improving but still challenging | Medium |
What are the potential risks of holding property in USD terms given local economic conditions?
Holding Vietnamese property exposes foreign investors to multiple layers of currency-related risks that cannot be eliminated through USD denomination.
The primary risk involves continued dong depreciation, which has averaged 2-4% annually and shows no signs of reversing. Vietnam's persistent trade deficits and inflation pressures support ongoing currency weakness, making USD-equivalent property values vulnerable to steady erosion.
Inflation in Vietnam occasionally surges beyond the central bank's target range, reaching 8-10% in periods of economic stress. High inflation periods typically accelerate dong depreciation, compounding currency losses for foreign investors.
Repatriation risks include additional currency conversion costs when selling property or transferring rental income abroad. These costs can range from 2-5% of transaction values, significantly impacting net returns for foreign investors.
Limited hedging mechanisms mean individual property investors cannot protect against currency risk. Unlike large corporations that can access forward contracts and currency swaps, individual buyers must accept full exposure to exchange rate movements.
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Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Vietnamese property transactions must be conducted entirely in VND, regardless of foreign investor preferences or marketing practices that may reference USD pricing.
The consistent depreciation of the dong against major currencies creates significant long-term currency risk for foreign property investors, with no practical hedging options available for individual buyers.
Sources
- Wise USD to VND Exchange Rate
- Vietcombank Exchange Rates
- ASL Gate Foreign Currency Regulations
- Eximbank VND Devaluation Analysis
- BizSpective Vietnam Real Estate Guide
- Vietnam Briefing Currency Analysis
- CVR Vietnam Real Estate Questions
- Vietnam News Exchange Rate Analysis
- Trading Economics Vietnam Currency
- VR Bank Currency Deposit Information