Social housing market is vibrant again thanks to new policies

VTV.vn - As demand increases and credit loosens, many businesses begin to restart projects to anticipate real demand.

Three new regulations benefit social housing buyers

From October 10, people with a maximum income of 20 million VND per month will be able to buy social housing. This level has increased by 5 million VND compared to before. This is one of the new points in Decree 261 amending and supplementing a number of articles on the development and management of social housing issued by the Government . The subjects of application are low-income people in urban areas, cadres, civil servants, public employees, unmarried or single workers. Compared to the old regulations, this Decree has 3 completely new points related to social housing policy.

The first point is to raise the income requirements for purchasing social housing. Specifically, to be able to purchase social housing, an individual must have a maximum income of 20 million VND/month. For a couple, the maximum is 40 million VND/month. In the case of an unmarried person or a person who is confirmed to be single and is raising a child under the age of marriage, the income level is calculated to be no more than 30 million VND.

The second point is to change the agency that verifies income for people without labor contracts. From October 10, low-income people in urban areas without labor contracts will request confirmation from the commune-level police where they permanently or temporarily reside instead of the commune or ward-level People's Committee as before.

The third point is to reduce preferential loan interest rates for individuals buying social housing from 6.6% to 5.4%, with overdue interest rates equal to 130% of loan interest.

People's access to social housing is expanded.

After the regulations on expanding the conditions for purchasing social housing were announced, they quickly received much attention from the people. In particular, raising the income ceiling for purchasing social housing to 20 million VND per month is considered appropriate to the actual situation. The new regulations help expand opportunities for people to access social housing more easily, thereby stabilizing their lives soon.

Decree 261 with new regulations helps thousands of families have the opportunity to own their first home. Illustrative photo

The apartment in the social housing project was bought by Mr. Nguyen Tan Dung (An Lac Ward, Ho Chi Minh City) for 900 million VND, with enough space for 3 family members to live and settle down. Previously, to be eligible to buy a house, his family had to prove that their income was under 30 million VND per month. Therefore, when he heard that the income limit had been raised to 40 million VND for the couple, he thought that this policy would help many families have the opportunity to own a house like his family.

"If a young family with both husband and wife earning around 40 million, it is very good to be able to buy social housing. I am very happy and joyful because in the future, our people will have a place to settle down and make a living," Mr. Dung shared.

Many people said that under the old regulations, proving an income of less than 15 million VND/month was very difficult because in reality, there were months when they had to work overtime or receive an additional year-end bonus. Therefore, the income level almost always exceeded the threshold to buy a house. Therefore, the new regulation of raising the threshold to 20 million VND/month is considered more suitable to the actual situation, helping many people have more opportunities to buy their first home.

Mr. Chau Quan Manh - An Lac ward, Ho Chi Minh City said: "If the regulation is raised to 20 million VND/month, it will help our people have more stable housing, just enough to live, but the amount is not too high...".

In addition, Decree 261 also stipulates that based on the ratio calculated on the average income per capita of the locality compared to the average income of the whole country, the locality can stipulate to increase the income conditions for people to buy social housing. This ratio will be decided by the Provincial People's Committee with the adjustment coefficient.

The Ho Chi Minh City Real Estate Association assessed this as a breakthrough, helping provinces and cities issue income levels to buy social housing suitable to the practical conditions of each locality.

Mr. Le Hoang Chau - Chairman of the Ho Chi Minh City Real Estate Association said: "For example, in 2024, Ho Chi Minh City will have a total average income per capita of 7.1 million VND. Compared to the average income per capita of the whole country of 5.4 million VND, the personal income ratio in Ho Chi Minh City is 1.31 times higher than the whole country. Thus, for an individual, instead of the regulation of 20 million in Ho Chi Minh City, it will be multiplied by 1.31 times, the income level of that individual will not exceed 26.2 million VND".

With the new adjustment rate, when buying social housing, a couple living in Ho Chi Minh City will have their maximum income condition increased to 52.4 million VND/month. For single people raising young children, the maximum is adjusted to 39.3 million VND/month. Thus, people in each locality will have a regulation level suitable to their actual income, demonstrating fairness between regions.

Lower interest rates help social housing buyers reduce financial burden

Regarding the loan policy, the new regulation clearly states: The interest rate for social housing loans is 5.4%/year. In case it is necessary to change the loan interest rate, the Vietnam Bank for Social Policies shall preside over and coordinate with the Ministry of Construction and relevant agencies to submit to the Prime Minister for consideration and decision.

So how will the interest rate reduction facilitate people's access to social housing? At the same time, will preferential policies be applied to loans for purchasing social housing before the Decree was issued?

Regarding the above content, VTV reporter had an interview with a representative of the State Bank, Branch Region 2.

Interest rate for social housing loans is 5.4%/year. Illustrative photo.

According to Mr. Nguyen Duc Lenh - Deputy Director of the State Bank, Region 2 branch: "The adjustment to reduce loan interest rates for beneficiaries of the policy of buying or leasing social housing, with long loan terms and low interest rates, clearly means that the amount of money to repay the bank will be less, thereby reducing the pressure to repay the loan. With an interest rate of 5.4%, the monthly repayment to the bank will be very low. The pressure to borrow will be reduced, the life of borrowers and policy beneficiaries will have both housing and a stable life, but will not be under much pressure to borrow from the bank. Obviously, this is a very meaningful, practical, humane adjustment and suitable for real conditions".

The State Bank of Vietnam, Region 2 Branch, said it has also prepared a plan to speed up the disbursement of credit packages, as well as provide loans to people at the interest rates set by Decree 261 that has just been issued.

Specifically, Mr. Nguyen Duc Lenh said that the effective date of the Decree is October 10, so the Social Policy Bank system will implement it now and according to the transitional provisions, all credit contracts signed before the effective date of the Decree and the Circular are issued will also be adjusted to the interest rate of 5.4%. These are positive points that the Social Policy Bank system in localities will implement immediately to support the people.

"In addition, information and propaganda work has also been promoted to help people and businesses access this policy easily. There are some very good models - that is, mobile consulting - in which some social policy banks go to localities, wards and communes to inform and propagate about the integrated policy, guiding people from the subjects, loan conditions and application procedures. From there, people who are eligible for social housing have easy access," Mr. Nguyen Duc Lenh informed.

Solutions to speed up the supply of social housing

It can be seen that income conditions have been expanded, home loan interest rates have also been adjusted down, the question now is: Are there projects for buyers to access?

According to a report from the Ministry of Construction, after 3 years of implementing the Project to invest in at least 1 million social housing units, the whole country has had 692 projects implemented with more than 633,000 units. Of which, 165 projects were completed with more than 110,000 units. Including the number of completed projects, projects that have started construction, and projects that have been approved for investment, the whole country has completed nearly 60% of the assigned target.

To get closer to the common goal and at the same time create more supply for people, businesses have come up with a number of solutions.

According to a report from the Ministry of Construction, after 3 years of implementing the Project to invest in at least 1 million social housing units, the whole country has had 692 projects implemented with more than 633,000 units. Illustrative photo.

Le Thanh Commercial Construction Company is building and planning to launch more than 1,400 social housing apartments. The investor said that the long investment procedure time for many years is the problem that the project is facing. Therefore, this problem needs to be improved to help businesses boldly invest in more projects, serving the needs of the people, especially low-income workers.

Mr. Le Huu Nghia - General Director of Le Thanh Commercial Construction Company suggested: "People cannot afford to buy commercial housing at high prices. With average income, people depend entirely on middle-income housing. How can we have enough housing, and have a significant supply, the main problem lies in the legal aspect. The State must simplify the legal procedures for social housing to the maximum to bring many upcoming projects to the market."

Cheap land funds are considered one of the solutions to increase social housing projects in the coming time, especially in large cities such as Hanoi and Ho Chi Minh City. Localities can create land funds or encourage businesses to invest in projects in suburban areas, far from the city center. However, the project investment area needs to go hand in hand with investment in transport infrastructure.

Mr. Vo Huynh Tuan Kiet - Director of Housing Project Marketing Department, CBRE Vietnam said: "Because for the area to develop low-cost housing projects, the initial prerequisite is to have enough conditions to meet the living environment and quality of life for future buyers and owners. Because if it is purely cheap land without connection, without infrastructure factors, it basically cannot meet the real housing requirements".

According to businesses, to have clean land, the state can allocate land through designated bidding or auction... from which they will easily access clean land. In addition, to attract private resources to participate in social housing investment, there also needs to be some appropriate mechanisms and incentives.

Mr. Vo Hong Thang - Deputy General Director of DKRA Consulting, Investment Director of DKRA Group proposed: "I think we need to have some solutions to the problem of land use fee deduction as well as input cost deduction, especially land cost for businesses at a reasonable level, which will solve the problem of social housing supply in the near future. I think that if we do these two points well, the goal of 1 million social housing units by 2030 will be achieved."

The regulation that social housing projects must reserve 20% of land fund, or exchange housing fund, equivalent money to develop social housing, is considered a major policy to create a large housing fund to meet the needs of the people. However, determining land fund, housing fund or converting into money in practice also faces many difficulties.

Expanding the income threshold and reducing loan interest rates not only helps many low-income people in urban areas, officials, civil servants, public employees, unmarried or single workers qualify to buy social housing, but also helps this market develop more stably.

However, experts believe that while people's needs have been met, supply also needs to be further stimulated and promoted. Through legal policy support, cheap capital is considered the solution to help balance supply and demand, thereby giving people more options for social housing in the future.

Source: https://vtv.vn/thi-truong-nha-o-xa-hoi-soi-dong-tro-lai-nho-chinh-sach-moi-100251016132547914.htm