Ho Chi Minh City has just officially approved the plan to develop social housing in the city from 2021 through 2025 with the target of developing 2.5 million square meters of construction floor, equivalent to 35,000 apartments including worker accommodation and student dormitories.
According to the report of the Department of Construction, 12 social housing projects and worker accommodations in the southern largest city are under construction. Currently, one project Binh Trung Dong project in Thu Duc City with a scale of 260 apartments has been put into use. Hoang Quan Real Estate Service Trading Consulting Company invested in the project.
In addition, nine other social housing projects with a total of more than 6,000 apartments are also under construction and construction investment procedures.
The implementation of some social housing projects is indeed not smooth; for instance, the Vinh Loc D'gold project with 1,344 apartments in the outlying district Binh Chanh’s Vinh Loc A Commune invested by An Nhan Investment and Development Company.
The investor committed that the project will be handed over in the second quarter of 2020, and then in June 2022, but now, it is still incomplete, making customers angry. Outraged customers have sent complaints to authorities asking to solve the case.
The Department of Construction has also sent a dispatch requesting the investor to speed up the construction progress and hand over the house to residents soon.
A project that has caused controversy for a long time is the Tan Binh housing - social housing complex project on Hoang Tat Dat Street in Tan Binh District invested by Tan Binh Real Estate Investment Company. When the project finishes, it will offer 168 apartments. The investor committed to hand over the house in March 2016 but so far residents have not lived in their dream apartments.
The project is under construction and has not been completed according to schedule, while a number of other projects are facing legal problems such as the social housing project in Tan Thuan Tay residential area in District 7 and the housing area in Phu Huu ward in Thu Duc City.
Talking to a reporter from SGGP Newspaper, Mr. Ngo Quang Phuc, General Director of Phu Dong Group, said that the construction of 35,000 social housing units or the goal of developing one million affordable housing for workers cannot be counted in a few years but decades. To achieve the goal, the city authorities must reserve land funds for the project and speed up legal procedures. In reality, the legal procedures for social housing projects are very complicated and investors can earn low profits making them dispassionate.
Mr. Le Huu Nghia, General Director of Le Thanh Trading Construction Company , an enterprise specializing in social housing, said that the current social housing approval procedure does not have its design process and standards, making businesses just based on the procedures of commercial housing projects. Despite the availability of the Decree 100 and Decree 49 on social housing in terms of policies, the implementation is entangled with many things.
According to him, businesses hardly have access to existing incentives for them. Le Thanh Company has recently applied for legal procedures for the project of social housing, but it has not been completed for three years. In the past five years, businesses carrying out social housing projects have had to borrow at commercial housing interest rates, so they cannot provide affordable houses.
In the process of managing and developing social housing and worker accommodation, the Department of Construction realized that there were many hiccups along the way; therefore, it proposed to the People's Committee of Ho Chi Minh City which will petition the Ministry of Construction to provide specific guidance on many contents.
According to Mr. Huynh Thanh Khiet, Deputy Director of the Department of Construction, responsible agencies should determine the cost of compensation for site clearance and investment in technical infrastructure to pay investors when handing over 20 percent of residential land in commercial housing projects for local governments. It is necessary to appoint an agency in charge of appraising and approving the above expenses to refund the investor.
The Department of Construction proposed that the municipal People's Committee petitioned relevant ministries and agencies to simplify the procedures for social housing investment. In addition, investors of commercial housing and urban development projects with a land use scale of 2-10 ha which are approved for investment in the period from December 2015 to April 2021 adjusted the project implementation schedule, they must build social housing according to the Investment Law.