Government takes urgent steps to support real estate

Many experts believe that the real estate market has many opportunities for growth, but before that happens there is an urgent need to untie many knots that are proving to be obstacles in its path to further development.

Speaking with Saigon Investment, Mr. Nguyen Van Sinh, Deputy Minister of Construction, said that there will still be several difficulties to face in 2023, but the real estate market will have a good chance to develop if some administrative barriers and hindrances are removed.

Journalist: - Sir, the Prime Minister has formed a working group in charge of reviewing and resolving problems faced in real estate projects, with you at the helm as the team’s deputy leader. How many of the tasks has your team fulfilled so far?

Mr. Nguyen Van Sinh: - Our team has worked with major agencies and organizations in Hanoi, Ho Chi Minh City, Da Nang, Hai Phong, Can Tho and some leading real estate corporations. We have identified some of the obstacles. Firstly, some overlapping or inconsistent legal regulations have been severely hampering efforts to implement projects in such areas as construction, urban planning and development, housing and real estate, land management and investment activities. The biggest concerns among relevant agencies and institutions are regulations on land use activities, including land use fees, changes of land use purpose, and land clearance.

Secondly, the red tape and complicated legal formalities have been hindering investment and construction projects in cities and provinces across the country. Thirdly, companies have been short of financial support due to difficult access to credit sources while they have had trouble issuing corporate bonds and dealing with maturing bonds. These difficulties have been making it extremely hard to implement projects on housing, especially social housing, and housing for low-income workers.

Currently, our team is reviewing and analyzing the problems before getting them settled. As planned, competent ministries and agencies are to prepare and send revised guidelines to the municipal and provincial authorities.

For instance, the Ministry of Natural Resources and Environment will be in charge of coping with land problems, the Ministry of Planning and Investment will be responsible for handling investment and bidding issues while the Ministry of Construction will solve problems related to construction, urban planning and development, housing, and real estate business activities. For problems beyond our authority, our team will send reports to the Prime Minister and competent authorities to seek guidance as to how to tackle those issues effectively.

- Sir, it is necessary to improve the relevant legal policy system in order to make the real estate market healthy in the long run. How will the Ministry of Construction carry out this plan?

- At the moment, the Ministry of Construction is implementing the plan, and focusing on a number of specific issues. The ministry is reviewing the legal regulations in order to propose some amendments to the regulations which have been overlapping or are inconsistent and creating obstacles for projects in areas of construction, urban planning and development, housing, and real estate activities.

The ministry will then present the problems to the Government for appropriate amendments to be made so as to make it possible for the Ministry of Construction to fulfill its state management responsibilities. After that, the Ministry of Construction will issue documents within its capacity or propose that the Government issue a decree with adequate guidelines on the process, order and procedures for implementing projects on investment and construction of social housing, commercial housing and urban area development.

In particular, the Ministry of Construction will focus on weighing and making amendments to the 2014 Housing Law and the 2014 Real Estate Law to make them consistent with the revised Land Law, the revised Bidding Law, and other relevant legal documents. Regarding the revised Housing Law, one of the most important contents is to perfect the policy on social housing development. For instance, it is essential to have regulations on grouping people, introducing conditions for policy beneficiaries, land planning and land fund. It is also vital to issue regulations on the order, procedures, and ways to select project investors as well as the state preferential mechanisms and policies on social housing development.

With respect to the revised Real Estate Law, the ministry will focus on four major policy groups, namely, business, service, market control and state management. There will be an attempt to improve the policies related to models, activities and transactions through the stock exchange, real estate brokerage, principles, methods and competence to regulate the market, manage and make appropriate information about the real estate market known to the public.

The Ministry of Construction is working hard on drafting a revised Housing Bill and a revised Real Estate Bill to submit to the Government and the Prime Minister for approval and submission to the National Assembly for further consideration at the 5th session meeting so that it can be passed at the 6th session meeting in 2023.

- Sir, do you think the one million social housing apartment project the Ministry of Construction has proposed to the Government will find market demand and ensure that the people who badly need such apartments will have access to them?

- While the social housing projects are implemented, there are still a number of hindrances and obstacles caused by regulations, policies, and capital sources, making it extremely hard for many people to get access to social housing. These issues were pointed out by the Prime Minister at the Conference on August 1, 2022 to promote the development of social housing for workers and low-income people.

At this conference, the Prime Minister ordered the Ministry of Construction to take charge and work closely with other relevant ministries and agencies to consider reports from cities and provinces so as to make reports and present them to the Prime Minister for approval of a project on investment and construction of at least one million social housing apartments between 2021 and 2030.

In the project, the Ministry of Construction proposes measures for ensuring sufficient land fund and capital sources and reforming laws and regulations in an effort to remove barriers and promote the development of social housing. Also, based on the information about the needs for social housing in the cities and provinces, the Ministry of Construction has set specific targets for each city and province to be achieved by 2030 in order to complete 1,416,700 apartments, with about 571,200 apartments completed by 2025 and around 845,500 apartments by 2030.

The concerned cities and provinces will have to introduce appropriate regulations and measures to make administrative formalities easy for related projects. It is imperative that the revised regulations on land use, land leasing and land clearance be favorable to encourage and attract businesses, especially big and reputable ones in the area of real estate, and to make investments and carry out projects to provide additional supplies in the market and meet the market needs for low-cost housing among workers and low-income people. After the project is approved by the Prime Minister, authorities at all levels will be responsible for the implementation of these projects and ensure the set goals are satisfactorily met.

- Thank you very much.

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