Not for real estate rescue

The VND120-trillion credit package is not intended to rescue the struggling real estate sector but to achieve the target of building at least one million social homes by 2030, said Deputy Prime Minister Tran Hong Ha at a meeting held on May 24. The package is designed to support developers and buyers of social housing. Interest rates for those loans would be 1.5-2 percentage points lower than the average of the four banks at the transaction time. However, the loan disbursement rate is far slower than expected, as there have been almost no takers since its launch two months ago. The slow disbursement is attributed to obstacles in land allocation and inadequate planning for social housing development. Many businesses are awaiting the implementation of the amended Housing Law for more streamlined procedures.

As the guidance documents were issued in April, many localities have still prepared a list of housing projects and the number of people eligible to take out the loans. Thus, Deputy PM Tran Hong Ha urged relevant units to speed up the planning and land allocation for social housing projects, especially largescale ones in major cities like Hanoi, HCMC, Haiphong, Danang, and Can Tho. Most issues related to legal procedures are being addressed through amendments to the Housing Law and Land Law.

The Ministry of Construction has been assigned to guide localities to submit monthly reports on implementing the credit package.

A report from the Ministry of Construction shows that around 100 social housing projects in 36 provinces and cities have been granted construction permits. These projects will develop 85,662 apartment units with a total investment of around VND70,000 billion. In Hanoi, over 4,000 social homes are currently available, and 40 projects are under development.