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Social housing failing to attract developers

Released at: 10:59, 11/06/2015

Social housing failing to attract developers

Policies on social housing in need of review and adjustment to meet needs and encourage involvement of construction companies.

Construction of social housing is a low-profit endeavor and few enterprises seek involvement, Minister of Construction Trinh Dinh Dung said, and these are factors behind the tardy development of social housing in Vietnam.

Many other countries have had social housing projects in place for decades despite average annual per capita incomes now standing at $30,000 to $40,000 or even $50,000.

Vietnam, meanwhile, remains in the initial stages of developing social housing while the average annual per capita income is around $2,000, according to Mr. Dung. “Mechanisms and policies are still in the early stages of implementation and need to be amended and perfected,” he said.

Some existing policies will be revised and improved shortly. “I’m certain that with the involvement of the government, enterprises, and the people, more social housing projects can be built to satisfy demand,” he added.

Vietnam has achieved remarkable results in building social housing at many industrial parks in northern Bac Ninh and Thai Nguyen provinces and Binh Duong and Dong Nai in the south. They have met the needs of thousands of workers and other people in area.

Mr. Dung noted that social housing development has been an important yet difficult task, as support from the State Budget is limited and most potential buyers are low-income earners.

“The State should play a key role in introducing support policies while local authorities must be given a decisive role in social housing projects,” he said. The government needs to adopt more policies regarding capital, land, and credit, to help enterprises invest in the field and to assist people to buy social housing properties.

“Overall policies must be implemented stably with a long-term strategy and, in particular, loans for buying social housing properties should be at low interest rates with flexible conditions,” Mr. Dung said.

In November 2011 the Prime Minister approved the National Housing Strategy and two years later the government issued Decree No. 188/2013ND-CP on social housing development. Adopted in 2014, the Law on Housing also has specific regulations on social housing development.

Thu Hoang

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