HCMC lacks social houses

Ho Chi Minh City is facing shortage of social houses because  of less land fund and capital.

Illustrative photo

Illustrative photo

Building old high-rise condo and social house are major program of the city. However, there is hiccups including lacks of land fund and capital along rebuilding new apartments to replace old ones.

Realizing huge demand of house of people in the city, the city adopted “open” policy to call for social contribution in building social houses.
The city Department of Construction said that during five past years, the number of social house just met 37 percent of demand  of low-income people in urban areas and workers in industrial parks compared to the expectation.

In a meeting on the city’s socio-economic condition in first five months of the year, agencies blamed the shortage of land fund and capital for the hiccup of the building program.

As per the law on housing effective in 2014 and the government’s resolution No. 100/2015 on developing and managing social house, commercial  house in urban areas, it is required to have 20 percent of land fund for social housing projects.

In industrial parks, the government said that abundant land in the parks will be allowed to build house for workers. However, a few investors follow the regulation to build apartments.

Capital for social house is taken from state budget, national bonds and development support fund. From 2013 to 2016, the government approved social housing program by launching a home credit package worth VND30 trillion (US$1.3 billion) with preferential interest to support enterprises to build social houses.
 However, the package ended in 2016. Currently no capital source is provided to help enterprises and residents that have demand to ask for loan.
To boost the program, People’s Committee asked the Department of Construction and related agencies to consult polices and measures to promote the projects as well as reduce administrative procedures aiming to facilitate enterprises and people. Banks are asked to finish policies relating to credit for buying social houses.

As per the Department of Construction, by 2020, the city will remove and build at last 50 percent of dilapidated apartments which were built before 1975. However, in ten past years, the city had removed 32 old condos to build new ones.

In 2017, HCMC authorities plan to continue renovating 10 other condo buildings  and pay site clearance compensation of five apartment buildings.
Additionally, they will also dismantle five deteriorating apartment buildings. The city will build six new condos at the old site with 1,800 apartments. Slowed progress is explained by lack of capital in a meeting between enterprises and the City's Party Secretary Nguyen Thien Nhan lately. 

Some enterprises complained they are unable to access to policies of rebuilding old condos.  A businessman said that his company presented a project to rebuild an old condo to related agencies seven years ago yet it has not been approved.
The Ho Chi Minh City Real Estate Association (HoREA) Chairman Le Hoang Chau said that the city should implement transparent policies to encourage enterprises along with improving administrative procedures to accelerate building old condo program.

In its letter to answer HoREA’s petition on fund for social housing program, the Ministry of Construction said that the National Assembly Committee approved to give additional VND2  trillion for building house for those who partook in the country’s revolution and for banks to link with the program.

By PHAN LE – Translated by UYEN PHUONG

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