With a series of projects stalled and supply sharply declining, more drastic measures are necessary for the market to revive and develop sustainably in the new year.

Supply is scarce due to legal problems

In the current context, the real estate market in Ho Chi Minh City is facing great difficulties due to scarce supply. Data from the Ho Chi Minh City Department of Construction shows that during the 11 months of 2024, the city had only 12 housing projects approved for investment, of which only one was a social housing project, the rest were high-end housing projects. This is the lowest number in many years, clearly reflecting the serious shortage of housing supply. In particular, only two commercial housing projects were granted construction permits and only four projects were eligible to mobilize capital to bring products to the market, with 1,611 apartments, a sharp decrease compared to previous years.

Mr. Le Hoang Chau, Chairman of the Ho Chi Minh City Real Estate Association, said that under the direction of the Government, the Steering Committee and Working Groups have closely coordinated with localities, including Ho Chi Minh City, to remove difficulties for real estate projects. At the same time, businesses in the industry have also made efforts to restructure their organizations, adjust their investment and product structures to maintain operations, and wait for recovery opportunities. In the first 10 months of 2024, Working Group 1435 of the Prime Minister transferred 64 projects to Ho Chi Minh City for consideration and resolution, of which the Thematic Working Group of the City People's Committee held 10 meetings, resolved 8 projects and continued to handle 26 projects with remaining problems. However, there are still more than 100 real estate and commercial housing projects in Ho Chi Minh City that are "legally entangled" and have not been resolved.

"These efforts from authorities at all levels, the business community, credit institutions and the support of investors and customers have contributed significantly to helping the real estate market overcome difficulties, initially recover and show signs of growth again in the past two years. In 2025, many businesses expect legal problems to be resolved soon so that the market can recover faster," said Mr. Chau.

Legal problems are the main factor hindering the development of the real estate market. The approval mechanism and investment procedures are still complicated, causing the implementation of projects to be delayed. Although the authorities have made efforts to resolve them, the congestion in land allocation, land lease, approval of detailed planning at a scale of 1/500, as well as administrative procedures related to design, appraisal, and construction licensing still exists. This prolonged process not only costs investors time and money, but also reduces the attractiveness of the market to investors, leading to a serious shortage of supply.

In addition, the lack of uniformity in legal regulations is also one of the reasons why real estate projects face difficulties in implementation. According to many experts, the real estate market in Ho Chi Minh City currently has a serious imbalance in product structure. High-end housing projects dominate the market, while mid-range and affordable housing products have almost no new appearance. This leads to a shortage of apartments suitable for the needs of the majority of people, especially families with low and middle incomes.

Administrative procedure reform should be prioritized.

One of the most important solutions to overcome difficulties for real estate projects is to reform administrative procedures. According to experts in the industry, current administrative procedures for real estate projects are too complicated and time-consuming. Although the time for administrative procedures has been regulated to be 310 days, in reality, businesses have to wait much longer. There are projects that take years just to complete basic administrative procedures such as planning approval, land allocation, land lease, and construction permit issuance.

According to Ms. Pham Thi Ngoc Thuy, Director of the Office of Private Economic Development Research, problems related to administrative procedures are always in the top 3 difficulties that businesses have to face, significantly hindering project implementation progress and business efficiency, especially in the real estate sector which has been under a lot of pressure from policies and the market.

Mr. Nguyen Quoc Hiep, Chairman of the Vietnam Association of Construction Contractors, also said that problems in administrative procedures and site clearance are not only the biggest obstacle but also the core cause of many real estate projects stalling, increasing costs and prolonging implementation time, putting heavy pressure on businesses in the current challenging market context.

M&A (Project Mergers and Acquisitions) is one of the important solutions to help real estate businesses overcome financial difficulties. However, according to the 2024 Real Estate Business Law, project transfers are only allowed when the investor has fulfilled its financial obligations, which makes it difficult for many "shelved" projects to be transferred and continued.

Experts say that to overcome these difficulties, the State needs to make adjustments in legal regulations to allow investors to transfer projects without having to fulfill financial obligations. This will help investors restructure projects and transfer them to other businesses that are capable of implementing and completing the projects. At the same time, this will also help create cash flow for businesses so that they can overcome financial difficulties.

An indispensable factor in the process of removing difficulties for the real estate market is close cooperation between the government and businesses. The government has made significant efforts to remove obstacles for projects, but to truly create a favorable environment for businesses, the authorities need to listen more and receive more opinions from businesses.

According to Son Nghia/VTV