Untangling the knots in social housing development.

Immediately after the meeting on rescuing the real estate market on March 16th, the Prime Minister , along with the Prime Minister's Task Force, 63 provinces and cities, the banking system, and the real estate business community, focused on resolving specific difficulties related to social housing, worker housing, and housing for low-income earners.

Supply shortage

According to the report on the implementation results of the Project "Investing in the construction of at least 1 million social housing units for low-income earners and industrial park workers in the period 2021 - 2030" by the Ministry of Construction , immediately after the Project was approved by the Prime Minister in Decision No. 338/QD-TTg dated April 3, 2023, the Government and the Prime Minister directed the Ministry of Construction and other ministries, sectors, and localities to focus on implementing the Project based on their authority.

In Resolution No. 01/NQ-CP dated January 5, 2024, on "Key tasks and solutions for implementing the socio -economic development plan and state budget estimate for 2024," the Government set a target of completing 130,000 social housing units nationwide in 2024.

By the end of March 2024, the whole country had planned 1,249 land areas, totaling 8,390 hectares, for social housing, an increase of 5,031 hectares compared to 2020. To date, 499 social housing projects have been implemented nationwide, comprising over 411,250 units. Of these, 71 projects with 37,868 units have been completed; 127 projects with 107,896 units have commenced construction; and 301 projects with 265,486 units have received investment approval.

With the strong direction and support from the Government, the Prime Minister, and the involvement of ministries, sectors, and localities, the development of social housing has seen many localities actively attracting investment and promptly commencing construction. In particular, the 120,000 billion VND credit package for social housing has been committed by banks to provide loans for 15 projects, totaling approximately 7,000 billion VND. Of these, 8 projects in 7 localities have already received disbursements totaling approximately 640 billion VND.

However, statistics from the Ministry of Construction show that, alongside some localities with good practices and accelerated progress of projects under the Scheme, many localities, despite having a great need for social housing due to the concentration of industrial zones and large numbers of workers, still have limited investment in social housing construction compared to the set targets.

The reasons cited by the Ministry of Construction are: the mechanisms and policies for developing social housing and affordable housing have not met practical needs and have not been supplemented or amended in a timely manner during the initial phase of the Project; the procedures for investment and construction, and for determining the conditions for purchasing, lease-purchasing, and renting social housing are still complex and lengthy; and the preferential policies for investors in social housing and affordable housing projects that have been issued are not attractive enough…

In addition, the Housing Law 2023, the Real Estate Business Law 2023, the Land Law 2024, etc., which have been passed, have introduced many mechanisms and policies to remove difficulties, reduce administrative procedures, and enhance incentives for investors, farmers, and the armed forces, allowing them to enjoy additional policies regarding worker housing in industrial zones, and reducing regulations and conditions for receiving social housing... However, these laws will only come into effect on January 1, 2025.

On the other hand, many localities have not paid attention to the development of social housing and housing for industrial workers, have not included targets for the development of social housing and housing for industrial workers in their five-year and annual socio-economic development plans, and have not clearly defined the land fund for social housing development in urban and industrial park planning, in addition to the 20% social housing land in commercial housing projects.

Furthermore, many localities have not been determined or proactive in implementing the assigned tasks in the Project; they have not issued a Project implementation plan to ensure the achievement of the objectives. Notably, some key localities, despite having a large demand for social housing, have limited investment in social housing compared to the Project's targets by 2025…

Urgent solutions for developing social housing.

According to statistics from the Ministry of Construction, several localities have had many projects approved for investment in the past period, but local authorities have not paid attention to or facilitated the selection of investors for project implementation. The 120,000 billion VND credit capital under Government Resolution No. 33/NQ-CP has not been disbursed effectively due to the limited publication of the list of eligible social housing projects…

Therefore, to achieve the goal, the Ministry of Construction proposes that ministries, sectors, and localities coordinate and urgently implement the tasks assigned by the Prime Minister in the Project. Specifically, focus should be placed on developing guiding decrees for the Housing Law, the Real Estate Business Law, the Land Law, the Law on Credit Institutions, and amending tax laws… to ensure legal consistency; and focusing on implementing the assigned tasks in the Project to resolve difficulties and obstacles related to investment procedures, land use fee exemptions, planning, land allocation, and the development of housing for workers…

Local authorities need to urgently develop, revise, and supplement their housing development programs and plans, clarifying objectives for social housing for low-income earners, industrial park workers, and members of the armed forces; review and supplement urban planning and industrial park planning to ensure sufficient land is allocated for social housing development…

At a recent conference organized by the Government to address difficulties and promote the development of social housing, Prime Minister Pham Minh Chinh affirmed that the Party and State's policy and guidelines are to build the country based on three main pillars: socialist democracy, the socialist rule of law, and a socialist-oriented market economy. Housing is one of these three pillars of social security, ensuring "a stable home is essential for a successful career." Therefore, the Government has focused on developing social housing, approving the Project "Investing in the construction of at least 1 million social housing units for low-income earners and industrial park workers in the period 2021-2030."

The State Bank of Vietnam has actively directed the implementation of the 120 trillion VND credit package for social housing loans. Ministries, sectors, and localities have actively implemented the program; however, the results have not been as desired. In the spirit of facing the truth, the Prime Minister requested ministries, sectors, and localities to focus on evaluating the results, limitations, objective and subjective causes; and to propose solutions to overcome difficulties and promote the development of social housing. In particular, they should review the policies, institutions, and approaches; the planning, allocation of land, and financial resources for social housing development.

According to the News Report

Source: https://doanhnghiepvn.vn/kinh-te/go-nut-that-phat-trien-nha-o-xa-hoi/20240323090623277