The Reasons Behind Hanoi’s Abandoned Relocation Sites

11 May, 2025

**Housing Project Left Abandoned While Residents Lack Shelter**

The Commercial Housing Project for Resettlement in Area X2 (Dai Kim, Hoang Mai) comprises a complex of three 28-story apartment buildings and three basement parking levels.

In 2018, the Management Board of Housing and Office Works (Hanoi Construction Department) and the General Corporation for Housing and Urban Development of the Ministry of Defense (MHDI) signed an economic contract on the ordering and creation of commercial housing for resettlement in Hanoi.

According to the contract, the Hanoi Construction Department (Party A) ordered MHDI (Party B) to establish a commercial housing fund to sell to resettlement cases. The project comprised 750 apartments, with a total investment of VND 1,300 billion, and was scheduled to be operational in Q1/2019.

As per the agreement, the consumption plan was for Hanoi city to repurchase all 750 apartments as resettlement housing for its residents. After 12 months from the date the project met the conditions for resettlement allocation, if the city did not arrange for resettlement or purchase the apartments, Party B could sell them on the market.

The X2 (Dai Kim, Hoang Mai) Resettlement Project has been abandoned for 5 years.

The business duration within the scope of this contract was determined to be 12 months from the date the project met the conditions for resettlement allocation. The contract was valid from the signing date until 12 months after the project met the resettlement conditions.

In September 2020, the Ministry of Construction announced the results of the inspection and completion of CT1, CT2, and CT3 of this project (X2, Dai Kim). However, from the time of acceptance until now, five years later, the project has not been put into use and remains abandoned, with no occupants.

The project was built, but it has been “shelved” amid a housing shortage for residents. Meanwhile, the investor, who invested significant capital in the project, is also struggling as they cannot pay the contractors.

What are the obstacles?

According to the Hanoi Construction Department, there are 14 projects to build commercial housing for resettlement under the ordering mechanism. Four projects have been completed and meet the conditions for use, and purchase contracts have been signed with the investors. The expected amount to repurchase the housing fund in four out of the 14 projects is up to VND 2,892 billion.

However, the Hanoi Construction Department stated that purchasing commercial housing for resettlement is challenging. The policy of ordering the purchase of commercial housing to establish a resettlement housing fund for the city does not mention a plan or method to recoup the money from selling state-owned housing (selling houses for resettlement cases) to the state budget as stipulated in the Law on State Budget.

The Hanoi Planning and Investment Department (now the Finance Department) proposed allocating capital to purchase commercial housing for resettlement by revolving capital. It is expected that about VND 3,000 billion will be allocated in the 2021-2025 investment plan (allocating capital through the Land Development Fund entrusted to the Hanoi Development Investment Fund) to purchase commercial housing for resettlement. However, the problem is that the Land Development Fund is not currently authorized to purchase commercial housing for resettlement.

The Planning and Investment Department has requested the Hanoi People’s Committee to assign additional tasks to the Land Development Fund, specifying the procedures, disbursement, payment, and settlement of counterpart funds from the Land Development Fund for the task of purchasing commercial housing for resettlement according to regulations.

At the same time, the Finance Department also proposed that the Hanoi People’s Committee allocate capital to the Hanoi Development Investment Fund to implement the purchase of commercial housing for resettlement.

The department also stated that Hanoi has a policy to stop implementing the pilot mechanism of ordering the construction of commercial housing to create a resettlement housing fund in the city, according to the approval of the Government Standing Committee and the agreement of the Hanoi Party Committee Standing Committee. Accordingly, Hanoi will only consider buying back commercial housing for resettlement under the ordering mechanism for commercial housing construction for projects with signed purchase contracts before June 9, 2023.

Meanwhile, investors have proposed that if there are difficulties in resolving this issue, Hanoi should approve the sale of the above housing fund on the market according to the signed contracts, promptly removing obstacles and difficulties for investors.

Ngoc Mai

– 08:30 30/04/2025