Affordable housing disappearing
At the Real Estate Forum on the spring of March 15, Mr. Hai said that in 2021, the government issued a resolution to promote social housing development, but there were no transactions in 2021-2022.
“I believe that the core issue is the incentives for social housing such as project approval, design approval, buyer demographics, project scale, and pricing are still very complex. About 2 years ago, we worked with the social housing investor, the project already had an investment license but the paperwork for social housing construction was just completed at the beginning of this year so we can proceed, ” Mr. Hai said.
Affordable housing disappears from the real estate market.
According to statistics from the Ministry of Construction, the number of social housing projects is very low compared to the set targets. Specifically, with the goal of building one million social housing units by 2025, Hanoi has only developed 1,700 units, meeting 9% of the target, HCMC met 19% with nearly 5,000 units. These localities also registered to complete social housing in 2024 at a low level: Hanoi nearly 1,200 units, HCMC nearly 3,800 units.
These are major cities, with a large concentration of low-income labor, and high demand for social housing but the results are very limited, indicating that localities are not determined and proactive.
The reason identified by the Ministry of Construction is that policies related to social housing development have not been amended promptly, resulting in many limitations such as lack of land funds, limited credit sources, and extended implementation time. Although revised laws such as the Housing Law and Real Estate Business have been adopted, they will not be enforced until early 2025. Therefore, the incentives for investors or the simplification of procedures have not been applied.
According to Mr. Hai, the root problem is the government’s incentives for land use tax, value-added tax (VAT), credit, and management costs are not suitable with market regulations, so investors are not eager.
Mr. Doan Van Binh – Chairman of CEO Group also said that, in fact, apartments priced below 25 million dong/m2 are almost extinct in Hanoi and HCMC. Currently, the “standard” price for affordable housing in these two cities has increased by 20-30%, to about 2 to 2.4 billion dong per unit.
Trading direction to social housing for rent
Mr. Nguyen Manh Ha – Deputy Permanent Chairman of the Real Estate Association – said that the viewpoint of the Party and the government is how people can all have a home, but the majority of Vietnamese people still want to own their own homes. Therefore, I think we should develop housing for rent, especially social housing.
The speakers at the Real Estate forum on the morning of March 15.
“I think we should build for rent instead of selling because it will be difficult to meet the demand due to the significant income gap. In many developed countries, including Germany, rental housing is the main type of housing,” Mr. Ha said.
According to Mr. Ha, the development of social housing should focus on rental housing, increasing the proportion to 30-40% will solve the housing problem. The state should encourage businesses and individuals to invest in rental housing. In the population there is still a lot of money but they only know how to deposit in the bank, while rental housing is also a potential channel and solves the housing problem.
