According to the Ministry of Construction, the resolution aims to ensure capital for the implementation of the project to build at least 1 million social housing units for low-income people and industrial park workers in the period of 2021 – 2030. It also aims to provide housing for all, especially those with social policies, low-income individuals, and the poor who are facing housing difficulties, thus contributing to political stability and social security.
The Ministry also shared that to realize the government’s project of building 1 million social housing units in the 2021-2030 period, a capital of 500,000 billion VND is needed. Therefore, the Ministry of Construction is drafting a resolution on a preferential credit package of 100,000 billion VND for the Vietnam Bank for Social Policies to lend for buying, leasing, constructing, renovating, and repairing social housing.
The interest rate for this preferential credit package of 100,000 billion VND for social housing loans will be the same as the interest rate for loans to poor households decided by the Prime Minister for each period.
The disbursement period for the preferential credit package will be until the full disbursement of the package, but not later than December 31, 2030.
A social housing project in Hanoi. Photo: Hong Khanh |
The disbursement allocation for the preferential credit package for social housing development is expected to be as follows: 16,500 billion VND per year in the period of 2025-2029, and approximately 17,500 billion VND in 2030.
Issuing Government Bonds
To implement the preferential credit package of 100,000 billion VND, the Ministry of Construction proposes that the Government assign the Ministry of Finance to thoroughly review and assess the possibility of issuing government bonds to capitalize the Vietnam Bank for Social Policies for lending to buy, lease-purchase, construct, renovate, and repair social housing.
The Ministry of Planning and Investment shall coordinate with the Ministry of Finance and related ministries and sectors to allocate government bond capital for social housing development. In the process of appraising the investment policy of industrial park infrastructure projects, the allocation of land funds for the development of worker housing in accordance with the Law on Housing must be appraised.
For the State Bank, the Ministry of Construction proposes that the Government assign this agency to coordinate with the Vietnam Bank for Social Policies to review and remove difficulties and obstacles to effectively implement the program of lending for social housing support.
The Vietnam Bank for Social Policies shall develop a project to issue bonds guaranteed by the Government, submit the dossier requesting a guarantee to the Ministry of Finance for submission to the Prime Minister for approval, and manage the capital source in accordance with regulations.
Localities must have specific mechanisms and measures to shorten administrative procedures related to project establishment and approval, land allocation, land lease, site clearance, and investment and construction procedures to support and encourage enterprises to invest in project implementation, create supply for the market, and take advantage of preferential capital for social housing development.
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Currently, social housing is using two capital sources: a credit package of 120,000 billion VND, which is self-balanced by commercial banks, and capital from the Vietnam Bank for Social Policies implemented according to Decree 100 on social housing from the state budget. According to the Ministry of Construction, with the credit package of 120,000 billion VND for investing and buying social housing with an interest rate 1.5 – 2% lower than the average commercial interest rate of the four state-owned commercial banks in the same period. However, after more than a year of implementation, the disbursement ratio of this package is very low because the interest rate and loan conditions are not really favorable for low-income people in urban areas and industrial park workers. Currently, the interest rate for this package is 7%/year for investors and 6.5%/year for home buyers. As of the end of the third quarter of this year, the total outstanding balance was 1,783 billion VND, of which eligible enterprises had 15 projects signed credit contracts with a total committed credit value of 4,200 billion VND and an outstanding balance of 1,633 billion VND. For home buyers, by the end of the third quarter, the capital of 120,000 billion had disbursed about 150 billion VND for home buyers at 12 projects. |
Hong Khanh
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