The Real Estate Giants: Vingroup, Becamex, Viglacera, and Hoang Quan’s Plea to the Prime Minister on Social Housing

At the National Online Conference on resolving difficulties and promoting the development of social housing held on the afternoon of March 6, participating businesses proposed specific solutions to effectively develop this segment.

Vingroup’s representative made two proposals to the Prime Minister. First, allow localities to appoint contractors and investors.

Second, allow localities to shorten procedures or do them in parallel. For example, it is possible to do planning and construction investment procedures simultaneously, which will save a lot of time. If the planning is completed and then the investment and finance procedures are carried out, it will create a lot of administrative procedures.

The representative of the Housing and Urban Development Corporation (HUD) proposed to apply the regulations on land use exemption fee in the 2024 Land Law and the 2023 Housing Law to social housing projects that have been approved in principle before the 2023 Housing Law takes effect.

Regarding profit compensation from the 20% commercial land to the selling price, the representative of HUD proposed that in case the locality has not determined the land use fee for the project according to regulations, allow the investor to proactively calculate and temporarily compare with the land use fee value temporarily calculated according to the locality’s announced land price at the time of calculation as a basis for approving the selling price of the project’s future formed houses.

In this case, the investor can commit that in case the final settlement of the project, if the profit from the 20% commercial land is lower than the land use fee to be paid according to regulations, the investor will bear the cost of this loss.

The representative also proposed that the Government consider and build regulations and mechanisms to prioritize the development of social housing projects by shortening the procedures and the time to perform the procedures.

In the step of selecting investors, the appointment method should be applied to projects that already have investors meeting full conditions (can be ranked according to the score through the evaluation of capacity, experience in the step of inviting interest, or according to the scale of social housing projects) or shortening the bidding process by improving the capacity and responsibility of the inviting agency. bid to reduce unnecessary procedures and time.

Meanwhile, Becamex’s representative said that it is necessary to soon build a national housing fund associated with a database on population and income, so that we can prepare a plan for construction and development, avoiding passivity. The legal procedures must be as simple as possible with a “one-door” mechanism.

If we standardize and use new technology, design models, it will help reduce costs, improve product quality, and shorten construction time significantly.

Another important point is a preferential loan program with a long term and a fixed interest rate. 100% of countries that are successful in building social housing have a policy of lending for 25 years at a fixed interest rate. This is very necessary, both for home buyers and for investors.

It is also important to integrate all social housing projects into the master plan for the development of the province and the region to establish a system of public transport, urban railways, thereby reducing normal traffic flow and forming satellite towns… We need to solve a more holistic problem, avoiding piecemeal development.

At the conference, Viglacera made two proposals. First, regarding the assignment of the investor that has been concluded by the Prime Minister, there is no need to bid since the design, price, and customers have been approved. It is suggested to directly assign the project to a capable unit to speed up the process as this procedure takes a lot of time.

Second, we are currently implementing social housing projects in industrial parks. There is a fact that the industrial park owners want to rent the buildings, then install furniture and allow workers to live in for free. This means that Vietnamese workers will be able to live in the buildings that the industrial park owners rent from the social housing investors. However, this is currently not allowed under the regulations, and we hope that this issue will be resolved soon.

Mr. Truong Anh Tuan, Chairman of the Board of Directors of Hoang Quan Group, proposed five issues. First, there should be a National Steering Committee for social housing and low-income housing.

Second, related Ministries and sectors such as the State Bank, Ministry of Construction, Ministry of Finance, Ministry of Agriculture and Rural Development should also have a Steering Committee for social housing to handle and resolve specific difficulties and problems.

Third, it is proposed that the State Bank coordinate with commercial banks to disburse loans for social housing projects.

Fourth, it is necessary to digitize data to easily search and classify subjects eligible for social housing.

Fifth, projects with investment capital below VND 2,000 billion should be appointed, and projects with larger investment capital should be bid.