Less cumbersome legal procedures, housing prices will decrease?

Mr. Le Huu Nghia, Director of Le Thanh Construction Trading Company Limited, said that social housing businesses always only hope to achieve an average profit of about 7%/year. However, if legal procedures are prolonged, costs will increase, leading to an increase in housing prices.

Specifically, if it takes 5 years to implement the project, the profit generated needs to increase by 35%. Therefore, when the legal procedures are quick and only last for 2 years, the profit level reaches about 14%, the business costs decrease, and the house price will be pulled down.

The 2025 Real Estate Seminar with the theme “Road to the Growth Decade” was held in Ho Chi Minh City on December 18. (Photo: Dai Viet)

According to Mr. Nghia, if legal procedures are streamlined and unnecessary procedures are reduced, businesses will save a lot of resources. Housing prices will be "cooled down", supply will increase, and the current "thirst" for housing will be relieved.

Sharing Mr. Nghia's opinion, Mr. Pham Dang Ho, Head of Housing Development and Real Estate Market Department (Ho Chi Minh City Department of Construction) said that legal procedures are a major barrier to the real estate market.

Recently, Ho Chi Minh City has applied new regulations, trying to solve the difficulties of businesses. However, the completion of legal procedures at projects is still delayed. This has also made many investors complain and discouraged.

According to Mr. Ho, the real estate market in Ho Chi Minh City has recovered but the recovery speed is still slow. To remove obstacles for investors, the Ho Chi Minh City Department of Construction is proposing a solution to integrate key investment procedures, avoiding multiple appraisals and overlaps between departments and branches. Typically, the approval of policies and 1/500 approval are being integrated.

"The Department of Construction is setting up an interdisciplinary working group to conduct centralized appraisals to help speed up project progress. In the immediate future, the Department will focus on removing obstacles for the social housing segment, then commercial housing. Recently, Ho Chi Minh City has approved the policy for 17 real estate projects, including one social housing project of Le Thanh Company," said Mr. Ho.

According to Mr. Ho, in 2025, the housing supply in Ho Chi Minh City cannot improve immediately because it takes time from the time of investment approval until the project is eligible for sale. In addition, the project approval process still has to go through many sets of laws, leading to a prolonged process.

DAI VIET

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