Affordable housing will flood the market in the next 10 years.

Sharing at the seminar "Solving the thirst for affordable housing and solutions to attract residents to new urban areas", Mr. Nguyen Thanh Quyen, General Director of Thang Loi Group, commented that in the near future, the development prospect of the affordable housing segment will be very optimistic.

In the next 10 years (ie around 2035) the market will witness two segments: affordable housing and luxury housing boom. These are the two segments that will drive the market.

According to him, in the story of affordable housing development, there are currently two main segments: low-cost commercial housing and social housing.

Affordable housing will flood the market in the next 10 years. (Illustration photo)

"I believe that in the coming time, there will be many businesses participating in this field. As for Thang Loi Group, we have registered two social housing projects and are waiting for three other projects," Mr. Quyen expressed.

According to Mr. Quyen, the reason for such a strong movement is because the three previous major bottlenecks of social housing have been largely removed - about 2.5 bottlenecks.

First is input costs, which are now more clearly defined and transparent.

The second is the profit control level. Previously, the profit level of 10% was very risky for the business, just one wrong calculation could lead to loss. Now this level has been raised to 13%, and we hope to adjust it more flexibly in the future.

Third, the subjects eligible to buy, rent, or hire-purchase social housing have also been significantly expanded, helping the market have more real beneficiaries.

" These changes will certainly create a new wave of investors participating in social housing development. We are no exception. For businesses, just a profit of over 10%, which is higher than bank interest rates in the current context of "cheap money", is enough motivation to invest.

I truly believe that in the next 10 years, the young generation of Vietnam will have the opportunity to own their first home. That is an opportunity that you should not miss. And to achieve that, we need the support of the entire system, from management agencies to large enterprises in the industry, the "Big Four" banks of the Vietnamese real estate market ," Mr. Quyen expressed.

Currently, four major banks have preferential programs specifically for people under 35 years old, with interest rates of only about 5.5% and long-term incentives. This is a very positive signal.

In the near future, the Government is also considering adjusting policies in a similar direction, to support the young generation who are in the beginning stages of settling down and starting a career.

" That is also the reason why I have a quite optimistic forecast about the affordable real estate market in the coming time ," Mr. Quyen emphasized.

Sharing about what price is considered cheap, Mr. Le Hoang Chau - Chairman of Ho Chi Minh City Real Estate Association (HoREA) said that, talking about low-cost housing, he believes there are two types. One is Social housing is of course the cheapest. Second is commercial housing with prices suitable to income, and this type really needs policies to develop.

Regarding social housing, recently in Hanoi , a social housing project was announced with a price of up to 29.5 million VND/m², which is quite high. But if you calculate carefully, the price of 29.5 million, roughly rounded to 30 million VND/m², an apartment of about 70m² will cost about 2.1 billion VND. With that price, if you can borrow at an interest rate of 4.8% for 25 years, the buyer can completely pay it.

As for affordable commercial housing, according to Mr. Chau, the price can be determined to be under 3 billion VND. For this type, investors do not need special mechanisms on land funds or taxes, but only need credit incentives. He recommends expanding this package to affordable commercial housing, with the interest rate of 5.9 - 6.1% that banks are currently applying, which is relatively reasonable.

Affordable home cleaning solutions

Mr. Nguyen Trung Vu, Chairman of the Board of Directors of Cen Land, said that first of all, the State must take the lead in reducing land use tax and consider land use tax revenue as a sustainable long-term budget source, instead of considering it a short-term source of revenue.

Experts propose many solutions to open up affordable housing. (Illustration photo)

If land use tax is considered a short-term source of income, real estate prices will be pushed up very high, making it very difficult for businesses to sell and develop in the long term. It should be considered a long-term source of income to help businesses grow.

Besides, according to Mr. Vu, affordable housing should be at 2 billion VND/apartment for young people, which can be paid in installments over many years. At present, it takes about 80 years of working without eating or drinking anything to buy a house in Hanoi, so we must aim to bring the house price down to a reasonable level. To achieve a reasonable price, businesses must have capital, and capital must be large, long-term and cheap.

Meanwhile, Mr. Le Hoang Chau said that to reduce prices, we must increase supply. But increasing supply here does not mean increasing in general, but increasing the supply of suitable and affordable housing.

In addition, to increase the supply of affordable housing, it is necessary to remove obstacles and difficulties for stalled projects. He said that according to the Prime Minister , there are currently 2,890 projects that need to be resolved. First of all, it is necessary to focus on handling and resolving these 2,890 projects.

In addition, according to Mr. Chau, it is necessary to create conditions for businesses to access land funds fairly, through the implementation of Resolution 171 of the National Assembly - on piloting the permission to receive the transfer of land use rights for residential land and other land that is not residential land (or currently having land use rights for other land that is not residential land) to carry out commercial housing projects.

Discussing solutions to reduce housing prices, Dr. Nguyen Van Dinh emphasized the need to speed up the process of removing legal obstacles for projects, especially social housing and projects in large cities, to increase the actual supply for the market.

At the same time, it is necessary to urgently complete the national database on real estate, because this is one of the reasons why the current market regulation is still ineffective. Along with that, it is necessary to deploy real estate transaction centers managed by the State to increase transparency and trust in transaction activities.

In addition, it is necessary to speed up the progress of key transport infrastructure projects, such as belt roads, metro lines, and highways, to expand urban space, attract business investment, and create more housing options at suitable prices for people.

Finally, according to him, it is necessary to build a mechanism to diversify capital sources for the real estate market, through investment funds, bond funds or new capital mobilization channels, to reduce dependence on bank credit and customer advances. Then, the formation and implementation of future projects will be more stable and sustainable.

Source: https://baolangson.vn/nha-o-vua-tui-tien-se-o-at-bung-ra-thi-truong-trong-10-nam-nua-5062225.html