On the morning of May 24, Deputy Prime Minister Tran Hong Ha had a meeting with leaders of the Ministry of Construction, the State Bank, the Government Office... on the progress of implementing the preferential credit package of 120,000 billion VND for investors and home buyers of social housing and worker housing projects.

Some businesses are waiting for the Housing Law (amended) to take effect.

According to the report of the Ministry of Construction, regarding the subjects of the 120,000 billion VND credit package, there are currently about 100 social housing and worker housing projects (in 36 localities) that have been licensed for construction and have been invested in construction with a total of 85,662 apartments, with a total investment of about 70,000 billion VND. Localities have 7 projects to renovate and rebuild apartments (in 4 localities) with a loan demand of about 4,130 billion VND.

Minister of Construction Nguyen Thanh Nghi said that in addition to the above projects, Bac Giang province has announced 12 projects eligible for loans. Some localities such as Hanoi, Binh Duong, Dong Nai are actively implementing social housing and worker housing projects. In Hanoi alone, there are currently more than 4,000 social housing apartments on the market and about 40 projects under implementation.

In April 2023, the Ministry of Construction and the State Bank of Vietnam (SBV) urgently provided guidance and urged implementation, reduced procedures, and shortened the time for document appraisal so that businesses could soon access loan capital.

Governor of the State Bank of Vietnam Nguyen Thi Hong said the VND120 trillion credit package was mobilized from capital sources of four state-owned commercial banks with an interest rate 2% lower per year than commercial interest rates; disbursement period until the end of 2030.

Analyzing the reasons why the VND120,000 billion credit package has not yet been disbursed, Minister and Head of the Government Office Tran Van Son said that the demand for social housing is very large but in the implementation process, there are still many problems in land allocation; lack of planning for social housing development in localities; the process of exempting land use fees for social housing projects is complicated and takes a long time; procedures and conditions for purchasing social housing... Therefore, some businesses are waiting for the Housing Law (amended) to take effect with more open procedures.

In addition, due to the newly issued guidance documents (in April 2023), localities are still making a list of social housing projects, worker housing projects and eligible borrowers.

Need to speed up planning and land allocation for social housing construction

Speaking at the meeting, Deputy Prime Minister Tran Hong Ha emphasized that the implementation of the VND120,000 billion credit package is not to "rescue" the real estate market but to contribute to the implementation of the Project "Investing in the construction of at least 1 million social housing apartments for low-income people and industrial park workers in the period 2021 - 2030".

Currently, most of the problems related to the process and procedures for implementing social housing and worker housing projects, and the conditions for purchasing social housing and worker housing are being amended and supplemented in the Housing Law and the Land Law, and will be basically resolved after these laws come into effect.

In the immediate future, the Deputy Prime Minister requested that localities need to speed up planning and land allocation for the construction of social housing and workers' housing in suitable, convenient locations, on a large scale, with full technical and social infrastructure, especially in large cities such as Hanoi, Ho Chi Minh City, Hai Phong, Da Nang, Can Tho... The Ministry of Construction instructed localities to periodically report monthly on the progress of implementing the 120,000 billion VND credit package.

The State Bank of Vietnam and the Ministry of Construction will study and propose appropriate interest rate support plans and periods for investors and home buyers eligible to borrow capital from the VND120,000 billion credit package.