Real estate businesses must overcome the paradox of excess luxury apartments and lack of affordable housing

The above opinion was emphasized by Deputy Prime Minister Tran Hong Ha at the meeting of the Prime Minister's Working Group on reviewing, urging, and guiding the removal of difficulties and obstacles in the implementation of real estate projects after the Land Law (amended), the Real Estate Business Law (amended), and the Housing Law (amended) were promulgated.

" The State will do its utmost, with great determination, and make great efforts to carry out what is within its responsibility and authority. At the same time, investors and real estate businesses must recognize their responsibility in overcoming the "paradox" of excess high-end segments, lack of products for middle- and low-income people, and resolving the situation of "price inflation" and "price pushing" so that supply and demand meet... ", said the Deputy Prime Minister.

Deputy Prime Minister Tran Hong Ha at the meeting on the morning of March 11. (Photo: VGP/Minh Khoi).

Besides, the Deputy Prime Minister said that "we need to have a clear, fair, objective point of view, without avoidance, in order to bring the real estate market back to normal operation".

Pointing out measures to be taken in the coming time, the Deputy Prime Minister requested the State Bank and the Ministry of Finance to study long-term fiscal policies to support interest rates for preferential credit loans; establish a social housing investment fund including the State budget, contributions from enterprises from the 20% cost of building social housing in commercial housing projects and other legal sources to support enterprises building social housing and people buying social housing, ensuring harmony between implementing social policies and market mechanisms.

The Deputy Prime Minister hopes that businesses and investors will calculate reasonable costs, offer commercial and social housing products at suitable prices, ensure quality, design, aesthetics and reasonable profit levels, harmonize the interests of the State and the people; and contribute to the healthy development of the real estate market.

The 120,000 billion VND social housing loan package still has many problems

At the meeting, Permanent Deputy Governor of the State Bank Dao Minh Tu raised a number of problems in the VND120,000 billion social housing loan package.

According to him, the key issue here is to create conditions for "demand to reach supply" and boost supply, on that basis reduce the objective price of the market in terms of supply-demand as well as with projects, corporations that push up prices, monopolize and speculate in real estate.

Representatives of BIDV, Agribank , Vietinbank, Hanoi People's Committee... said that the difficulty in disbursing the 120,000 billion VND commercial credit package for social housing is the investor's ability to meet the requirements of financial capacity, collateral, project liquidity, and the limit on profit margins of social housing projects...

" Not all social housing construction enterprises that BIDV approaches have a need for loans, because many projects do not have full conditions for implementation, or are using their own capital, " said Mr. Tran Phuong, Deputy General Director of BIDV.

Some businesses have proposed shortening the time to review legal procedures and land use origins for social housing projects; simplifying administrative processes and procedures; loosening credit access conditions for investors and buyers with low and middle incomes...

The Deputy Prime Minister directed the synchronous implementation of many measures for the healthy development of the real estate market. (Illustration photo: Minh Duc)

Removing difficulties and obstacles in new laws

Concluding the meeting, Deputy Prime Minister Tran Hong Ha emphasized that the development of a healthy real estate market contributes to socio-economic growth, creates jobs, and ensures people's right to access housing.

In recent times, the real estate market has been affected by the domestic and global economic situation, especially after the COVID-19 pandemic, as well as loopholes and weaknesses in the management of capital, land and real estate markets.

The problem is to regain investors' trust in a systematic, synchronous, scientific, and responsive manner in the management of real estate, land, credit, capital, etc., creating a healthy market, encouraging investment and business, and avoiding the real estate "bubble".

The Deputy Prime Minister requested the Ministry of Construction to summarize the main problems that can be solved in the recently passed amended and supplemented laws on land, housing, real estate business, etc., and then study the plan to advise and submit to the Government and the National Assembly to issue documents within their authority to allow application before the law takes effect.

The working group compiles statistics on the number of real estate projects that have been allocated land but are facing legal procedures; develops criteria for capable real estate investors; summarizes the pilot project allowing localities to locally adjust planning for real estate projects without reducing general criteria; expands the scope of access to social housing for people with low and middle incomes and enterprises in industrial parks; provides full guidance for localities to comply with existing mechanisms and policies on land recovery, site clearance, resettlement, and land valuation, etc.

" Resolving the petitions of enterprises and localities must have a specific address and deadline. Which ministry or sector is responsible and when will it be completed ?", said the Deputy Prime Minister.

The Deputy Prime Minister assigned localities to specifically calculate people's needs, fully allocate land funds for housing projects, renovate old apartments, in the process of establishing and implementing urban and rural planning; report on the activities of local working groups on removing difficulties and obstacles in implementing real estate projects.

Deputy Minister of Construction Nguyen Van Sinh said that recently, the real estate market in general and the removal of difficulties in implementing real estate projects have had many positive changes.
Typically, Hanoi currently has 404 projects. Through reviewing and classifying difficulties and obstacles, they have been resolved: 81 projects have been removed from the list of slow-to-implement projects; 10 projects have had their land reclaimed and operations terminated; 67 projects continue to urge investors to speed up the implementation progress. Hanoi is continuing to implement the removal of difficulties and obstacles for 246 projects according to the guidance of the Ministry of Construction and other ministries and branches.
Similarly, Ho Chi Minh City has implemented the resolution of 33/72 projects requested by the Working Group; 44/148 projects proposed by the City Real Estate Association; and is continuing to resolve difficulties and obstacles for 143 projects...

Chau Anh

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