A new Circular from the SBV details changes to eligibility and terms in the housing support package.
The State Bank of Vietnam has introduced Circular No. 32 regarding the government’s housing support credit package, replacing Circular No. 11 and extending the group of eligible borrowers and the timeframe for preferential interest rates. Rather than obtaining a loan to buy, build or refurbish houses, low-income earners eligible for preferential treatment will be supported with interest-free funds to build or refurbish houses. The maximum loan term is ten years from the first disbursement and loans are available until June 1, 2026. The size of any loan will be agreed upon between the bank and the borrower, but will not exceed VND700 million ($32,860).
Regarding purchasers buying social housing or commercial housing, the maximum loan term is 15 years since the first disbursement and loans are available until June 1, 2031. The term in the new Circular is extended by five years to ten years but remains at five years for enterprises. However, instead of only enterprises being allowed to build social housing, the new Circular permits individuals or households to obtain a loan to build social housing for sale or lease.
The Circular comes into effect on November 25. The government’s housing support credit package, worth VND30 trillion ($1.4 billion) and launched in June last year, aims at helping low-income earners secure housing. The interest rate is a maximum of 5 per cent per a year and the maximum loan term was originally set at 15 years for individuals. According to Deputy Minister of Construction Nguyen Tran Nam, in the National Housing Development Strategy by 2020 and the Vision towards 2030, housing development is the responsibility of the State, society and the people. The government has asked banking institutions to provide loans at low interest rates and reasonable terms to housing developers and low-income earners in urban areas.