The development of social housing and meeting the housing needs of low-income and disadvantaged individuals, as well as the poor, is a major policy of the Party and the Government of Vietnam. This policy aims to ensure social welfare and sustainable growth and development. This policy has been implemented with a synchronized approach, focusing on harnessing resources for the social housing development program. One of the key aspects has been the improvement and issuance of policies related to land, housing, and finance (including the Land Law, the amended Housing Law, and the decree on social housing development), which have provided a crucial source of support for this initiative, aiming to deliver 1 million social housing units by 2030.
Mr. Nguyen Duc Lenh, Deputy Director of the State Bank of Vietnam’s Ho Chi Minh City Branch, assessed the financial resources and the role of the banking sector in meeting the capital needs for the development of social housing projects and individual home purchases. He highlighted the effective implementation of preferential credit policies, with specific programs and solutions.
The preferential credit policy for social housing loans for policy beneficiaries (the poor, disadvantaged individuals, and other eligible groups) is implemented through the Vietnam Bank for Social Policies. This long-standing credit program offers preferential interest rates and long repayment periods of around 20-25 years. In Ho Chi Minh City alone, the program has a loan balance of approximately VND 100 billion, serving 274 customers (households), equivalent to 274 established apartments.
Implementation of preferential credit policies for social housing (including project investors and individual home buyers) in accordance with Government Decree 100/2024/ND-CP. The decree’s provisions on interest rates, loan terms, and income requirements facilitate access to credit for social housing development and address the housing needs of low-income individuals.
Deployment of preferential credit packages to support social housing development, with commercial banks participating in a VND 145,000 billion package. The current interest rates for this package are 7% per annum for investors and 6.5% per annum for individuals (for the first 3-5 years), with long repayment periods of 20-25 years. The disbursement of these credit packages will facilitate access to capital and boost the government’s social housing program.
To date, Ho Chi Minh City has announced 6 social housing projects, of which 2 have borrowed from banks (at regular interest rates, but with preferential rates offered by credit institutions). One project, providing housing for rent to workers, has borrowed from the VND 145,000 billion package, with a total credit limit of VND 680 billion, of which VND 170.14 billion has been disbursed.
Mr. Lenh noted that despite the low-interest rates and the credit institutions’ ability to meet capital needs, the disbursement rate has not been high. This can be partly attributed to projects not yet completing legal procedures and meeting credit conditions.
However, with positive changes in housing policies, incentives for investors, concrete actions (such as task forces to address difficulties), and preferential credit policies, well-coordinated and synchronized implementation will drive the development of social housing and achieve the program’s goals. Key factors such as selling prices, buyers’ income, project legality, and efficiency will remain crucial in unblocking bottlenecks and facilitating capital circulation. This process will motivate the disbursement of preferential credit packages and increase credit growth for social housing in the future.
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