Ministry of Construction: Land valuation method makes it difficult to determine market price

The Ministry of Construction has just sent a report to the National Assembly's Economic Committee regarding the real estate market situation and social housing development.

According to the Ministry, in 2022, newly licensed real estate projects will continue to decrease compared to 2021, causing the supply of real estate and housing, especially housing for low-income people, to remain limited. The number of real estate and housing in new projects put up for transaction (supply) is limited. The real estate products put up for transaction are mainly inventory of projects that have been opened for sale.

In the report, the Ministry also pointed out a series of difficulties and problems related to land law. For example, many projects encountered difficulties, problems, and slow implementation due to regulations on land valuation methods that made it difficult to determine the "market" price (accounting for over 50% of the problems of the projects); many cases of land use planning have been announced but there is no annual land use plan at the district level; compensation and site clearance; land allocation and lease of BT counterpart projects...

Bộ Xây dựng: Phương pháp định giá đất khó xác định đâu là giá thị trường - 1 — Many real estate projects in Me Linh district ( Hanoi ) are facing difficulties and have been delayed for many years (Photo: Ha Phong).

Difficulties related to laws on planning, investment, housing, urban and construction regulations were also pointed out by the Ministry of Construction.

Regarding difficulties in bond issuance, the Ministry of Construction said that the Ministry of Finance has advised the Government to issue Decree No. 08 dated March 5, 2023 on the offering and trading of corporate bonds and directed relevant agencies to remove difficulties in capital mobilization of enterprises in the stock market and corporate bonds. However, capital mobilization of enterprises through the stock market and bond issuance is still difficult.

In addition, according to the Ministry of Construction, recently, many inaccurate and unofficial social information has negatively affected the market, especially information about finance, credit, bonds, stocks, and handling of violations at some enterprises (such as VinGroup, Novaland, etc.) causing confusion for customers and investors. The above information also causes difficulties for enterprises and negatively affects the real estate market and the stock market. Many enterprises and projects are not selling products, have no cash flow, and are facing difficulties in liquidity.

Reporting on the implementation results of the Prime Minister's Working Group, the Ministry of Construction said that, up to now, this Working Group has received 58 documents reporting difficulties, problems and recommendations from localities, businesses and people. Of which, there are 3 documents from 2 localities - Dong Nai and Soc Trang, 50 documents from 37 businesses, 5 documents from people related to 115 real estate projects (Novaland has 6 projects, Hung Thinh Group has 44 projects, HUD has 16 projects).

The working group has studied, reviewed and handled 50 recommendations according to its authority, of which 48 documents have been sent to the People's Committees of provinces and cities and 2 documents have been sent to the Ministry of Planning and Investment and the Ministry of Natural Resources and Environment for settlement according to their authority.

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