Prime Minister: "Apartment prices are 70 - 100 million/m2, who has the money to buy?"

VTV.vn - Prime Minister Pham Minh Chinh emphasized that apartment prices of 70-100 million VND/m2 are far beyond affordability, while the supply of social housing is limited and capital disbursement is slow.

Social housing supply is still limited.

On the afternoon of September 22, Prime Minister Pham Minh Chinh , Head of the Central Steering Committee on Housing Policy and Real Estate Market, chaired the Conference to announce the decision to reorganize the Steering Committee and the first meeting of the Steering Committee. At the meeting, the Prime Minister said that the real estate market and social housing development still face many difficulties. In addition, the housing segment is still inadequate, the main products are the high-end segment, and at times, housing prices increase dramatically, especially in big cities.

Reporting at the meeting, a representative of the Ministry of Construction said that apartment prices in Hanoi and Ho Chi Minh City remained high with an upward trend compared to the same period last year. The average price was from 70-80 million/m2, an increase of 5.6% compared to the beginning of the year. Meanwhile, social housing - the segment expected to help reduce housing prices, although there has been an improvement in quantity, is still quite slow compared to the set target.

According to the report of the Ministry of Construction, by the end of July this year, the number of social housing units reached 59.6% of the target set in the project of 1 million social housing units. Besides some localities that have done well such as Hue City, Hai Phong City... Many localities are still implementing slowly, not reaching the set target.

Regarding the disbursement of the 145,000 billion VND loan package for social housing development, it is still very limited, after more than 2 years only more than 4,000 billion VND has been disbursed.

"Is there any business that does not borrow money? Is there any business that does not borrow money from the bank to do real estate? Can the bank control how much money is borrowed? Is it used in real estate? Or is it going somewhere else? Why can't the bank package be disbursed? How many people need a house, but because the house price is too high, they can't buy it. Who has the money to buy a house that costs 70 million to more than 100 million VND/m2 in an apartment building?", Prime Minister Pham Minh Chinh emphasized.

The first meeting of the Steering Committee - Photo: VGP/Nhat Bac

Difficulty in disbursing loans for social housing

Reporting at the meeting on the afternoon of September 22, a representative of the State Bank said that up to now, the State Bank has announced 6 times that the lending interest rate will gradually decrease, from 8.7%/year for investors and 8.2%/year for home buyers at the beginning of the program, now it has decreased to 6.4%/year for investors and 5.9% for home buyers.

The reality of the market shows that both businesses and people are facing financial difficulties and want to access bank capital. Meanwhile, banks claim that they "do not lack money". But the paradox is that supply and demand have not yet met. For home buyers, not being able to access the social housing supply makes it impossible to borrow this credit package. In the meeting yesterday afternoon, the parties had frank discussions about the causes and solutions.

According to the share, although banks have available capital, the number of social housing projects that meet the loan criteria is still low. Therefore, banks have difficulty disbursing.

Mr. Ho Van Tuan - Deputy General Director of Vietcombank said: "Difficulties and problems related to site clearance, land use fee payment, legal documents to ensure that investors have clean land for implementation. The bank needs to have that to sign contracts and disburse funds".

Mr. Nguyen Ngoc Canh - Deputy Governor of the State Bank of Vietnam reflected: "Some real estate investors have limited financial capacity, in which long-term capital mobilization channels for the real estate market such as bonds and securities are still underdeveloped, so the capital source for real estate investment is completely dependent on credit capital. Investment in the real estate market is medium to long-term, while the capital mobilized by banks will be short-term capital and the difference in terms may have liquidity risks if borrowers cannot repay on time. That is the difficulty".

Meanwhile, businesses and real estate associations believe that the disbursement of capital for social housing needs to focus on solving difficulties for home buyers. That is, raising the income level to buy social housing to over 15 million VND/month, to expand the number of people eligible for loans and extend the loan period.

Mr. Tran Ngoc Anh - Deputy General Director, Viglacera Corporation - Joint Stock Company recommended: "For home buyers, the recommended interest rate is about 5%. In a lifetime, people can only buy one house, 50-70m2. Some people can only pay 15 million a month, and if they borrow for 5 years, including principal and interest, they cannot do it."

"Amending Decree 100 on social housing, the income is 20 million for individuals, 40 million for couples. This is very good, we have faith to see the movement" Mr. Le Hoang Chau - Chairman of the Ho Chi Minh City Real Estate Association commented.

Many other opinions also believe that it is necessary to speed up procedures such as site clearance and land valuation for social housing projects. Because the longer the investment procedures take, the more costs businesses have to spend, thereby causing housing prices to increase.

The Prime Minister stated that the Government and the Prime Minister are determined to build and develop a stable, safe, healthy, open and transparent real estate market - Photo: VGP/Nhat Bac

After listening to opinions at the meeting, Prime Minister Pham Minh Chinh emphasized 11 groups of important tasks and solutions to aim at increasing supply, reducing costs, striving to keep commercial housing prices at a reasonable level, consistent with the nature of the market, consistent with the Vietnamese economy, consistent with the average income of the people, promoting the development of social housing, so that people have favorable and suitable housing conditions.

"The Government and the Prime Minister are determined to build and develop a stable, safe, healthy, transparent and open real estate market that complies with the laws of the market economy, is managed by the State, and is under the leadership of the Party. Where is the problem, what is the problem, where is the problem, whose responsibility is it, at what level? The spirit must be clear and we must be determined to do it, no matter how difficult it is. Why? Because this is the development of the country. If the real estate market develops and social housing policies are done well, it will contribute to the rapid and sustainable development of our country," Prime Minister Pham Minh Chinh said.

Prime Minister Pham Minh Chinh also requested the State Bank to study mechanisms and policies related to loan interest rates, appropriate loan terms, and favorable procedures; to have appropriate policies and sanctions for banks that perform well and those that do not; and for banks to continue to promote the spirit of responsibility, nationalism, compatriotism, and the application of science and technology to reduce costs. At the same time, the Ministries must soon complete the legal framework and procedures to establish the National Housing Fund, to be completed this September.

Source: https://vtv.vn/thu-tuong-gia-nha-chung-cu-70-100-trieu-m2-ai-co-tien-ma-mua-100250923062132961.htm