At the 13th Party Central Committee meeting in early 2025, General Secretary To Lam emphasized the urgent need for policy mechanisms to address inefficiencies and accelerate economic momentum. He directed authorities to prioritize resolving wasted resources, including suspended planning, stalled projects, unused public land, and prolonged asset disputes.
General Secretary To Lam also stressed the importance of removing bottlenecks in the real estate and capital markets, particularly corporate bonds, to swiftly boost supply. These measures, he stated, are critical to achieving an economic growth target of 8 percent or more in 2025 and sustaining double-digit expansion from 2026 to 2030.
The directive of General Secretary To Lam once again underscores the critical role of the real estate market in driving economic growth. Previous studies have shown that the Vietnamese real estate market contributes directly about 3.5 percent to GDP and indirectly up to 7.62 percent when considering related industries such as construction, tourism, accommodation, manufacturing, and finance - banking.
However, in recent years, the real estate market's contribution to GDP has sharply declined due to numerous stalled projects. According to data from the Ministry of Construction, thousands of projects nationwide remain inactive. In Hanoi alone, of 404 projects are currently on hold, barriers of some 158 have been removed while 246 continue to face difficulties.
The situation in Ho Chi Minh City is equally challenging, with 220 projects currently experiencing significant impediments. Only 77 projects have been successfully resolved, leaving a considerable number of projects—143—still facing unresolved obstacles. Most recently, the working groups have made significant efforts, including the successful resolution of issues for 30 projects. Some eight projects have been completely resolved.
This figure represents a minuscule portion of the actual demand, with a concerning number of 86 commercial housing projects currently suspended or stalled due to legal hurdles. Furthermore, the approval process for new real estate projects remains excessively slow, with only approximately 20 projects receiving approval per quarter across the country, severely hampering the development of the sector.
The project approval process is plagued by several significant challenges. The determination of land use fees, compensation packages, and the execution of site clearance procedures often prove to be major obstacles, leading to prolonged delays. Furthermore, heightened scrutiny and inspections following some investors’ misconduct have further worsened the situation.
Additionally, some local authorities have made adjustment of master plans leading to projects having to be temporarily suspended for re-planning and the existing delays. Last but not least, the declining financial health of many enterprises has severely limited their access to capital, further hindering project progress.
The stagnation of real estate projects not only wastes resources but also increases the shortage of housing supply, creating a phase difference in market segments. It is the culprit of continuously increasing housing prices in recent times, which is quite beyond low and middle-income earners.
Meanwhile, real estate businesses are under mounting pressure, with bond maturities reaching approximately VND180,000 billion in 2025. Capital bottlenecks are stifling business opportunities, pushing many firms to the brink of survival. In this context, implementing priority policy mechanisms to unlock stagnant resources in the real estate sector is both urgent and essential.
While the determination to 'untie' the real estate market is evident, achieving optimal results necessitates close collaboration between state management agencies and businesses. This requires a concerted effort to perfect the legal framework, strengthen inspection and supervision mechanisms, and streamline the overall process.
The 2024 Land Law, the 2023 Housing Law, and the 2023 Real Estate Business Law, along with their guiding documents, have now had sufficient time to take effect. These legal frameworks are helping to ease difficulties in the real estate market, gradually resolving regulatory overlaps and establishing a more transparent and efficient mechanism for project development.
However, ministries, agencies, and localities must actively promote the implementation of guidance within their respective jurisdictions, ensuring the swift and effective implementation of new legal regulations.
Addressing the numerous stalled and struggling real estate projects is paramount to revitalizing the market. This requires a thorough review of each project, followed by the development of a systematic plan to address its specific challenges. By effectively removing these obstacles, the market will experience a significant increase in supply, leading to a more balanced and realistic pricing structure. This will not only stabilize the market but also have a profound positive impact on overall economic growth.
