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Vietnamese localities to approve social housing projects eligible for $5.1bn credit pac

Vietnamese localities to approve social housing projects eligible for $5.1bn credit pac

Tuesday, April 25, 2023, 15:11 GMT+7
Vietnamese localities to approve social housing projects eligible for $5.1bn credit pac
Deputy Minister of Construction Nguyen Van Sinh presides over a press conference in Hanoi on April 24, 2023. Photo: T.D.H. / Tuoi Tre

The Ministry of Construction will authorize localities to approve and announce a list of social housing projects entitled to a credit package worth VND120 trillion (US$5.1 billion) launched by the government.

The ministry has sent the proposal to the prime minister, Deputy Minister of Construction Nguyen Van Sinh said at a press briefing in Hanoi on Monday.

The Ministry of Construction is normally responsible for making a list of social housing projects.

However, localities will do the job for projects eligible for the $5.1-billion credit package after the projects are approved and construction licenses and land are handed over for them to facilitate homebuyers.

Banks will use the list announced by cities and provinces to disburse loans for enterprises and home buyers.

The Vietnamese government last month assigned the State Bank of Vietnam to deploy the credit package for developing social housing projects and upgrading deteriorating apartment buildings.

In particular, the central bank will direct commercial banks, mainly four state-owned banks -- the Vietnam Bank for Agriculture and Rural Development (Agribank), the Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV), the Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank), and the Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) -- to offer loans with interest rates that are 1.5-2 percentage points lower than average lending rates.

According to the Ministry of Construction, the credit package can meet some 12 percent of the needed capital for one million social houses and houses for workers in the 2021-30 period.

The local real estate market faces multiple difficulties in the first quarter of this year. Photo: Quang Dinh / Tuoi Tre
The local real estate market faces multiple difficulties in the first quarter of this year. Photo: Quang Dinh / Tuoi Tre

Regarding the real estate market, Deputy Minister Sinh said the market faced many difficulties last quarter with limited supplies and low liquidity.

The government has issued many solutions to remove the difficulties, such as simplifying investment, land handover and appraisal procedures and resolving obstacles in capital.

The Housing Law and the Law on Real Estate Business are being amended.

The Ministry of Construction also worked out solutions to boost the social housing development, including simplifying the land appraisal, offering incentives for investors, and determining the prices and rentals of social houses, among others.

Policies for social housing projects are expected to take effect as soon as being passed by the National Assembly at its sixth sitting in October, Sinh said.

Hundreds of property projects have their legal obstacles removed. Photo: Quang Dinh / Tuoi Tre
Hundreds of property projects have their legal obstacles removed. Photo: Quang Dinh / Tuoi Tre

He also stated that the prime minister’s working team had worked with localities to remove obstacles for hundreds of property projects.

In Ho Chi Minh City, over 80 percent of the 180 surveyed housing projects were found to face bottlenecks.

Meanwhile, Hanoi has 170 projects encountering obstacles; Da Nang, 75; Hai Phong, 65; and Can Tho, 79.

Most of them face obstacles in land, construction, planning, investment, and housing regulations.

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Thanh Ha - Bao Ngoc / Tuoi Tre News

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