The Vietnam Association of Real Estate Brokers (VARS) believes that Circular 06/2023/TT-NHNN should be revoked and a decree issued that more closely follows the spirit of Resolution No. 33/NQ-CP should be issued.

According to VARS, currently, “legal” and “capital” are the two main and inherent difficulties of the real estate market. Although the Government has issued many solutions to remove and resolve them, up to now, these two difficulties have not really found a definitive solution.

In fact, there are thousands of projects that are difficult to implement, are shelved due to legal problems, and have to stop for review. And there are also many projects that have broken access to credit and investment capital from customers. In particular, projects that are unfinished in the process of site clearance, waiting for land use fee approval, under construction... leading to stagnation. The fact that both customers and investors have difficulty accessing cash flow causes liquidity in the market to be blocked, freezes all transactions, and stops all investment, production, and business activities...

In this context, VARS believes that Circular 06/2023/TT-NHNN will not ensure the spirit of Resolution No. 33/NQ-CP.

Accordingly, Resolution No. 33/NQ-CP clearly and resolutely demonstrates the goal of removing difficulties in credit capital sources, aiming to unblock capital flows for the real estate market, contributing to increasing liquidity for the Vietnamese real estate market, through creating favorable conditions for businesses, home buyers and investors to access credit capital sources with preferential interest rates. Thanks to that, feasible and effective projects will have the opportunity to be implemented, contributing to improving supply for the market.

However, Circular 06/2023/TT-NHNN does not adhere to the spirit of Resolution 33/NQ-CP. Specifically, it does not specify the subjects that are supported and have their credit difficulties resolved. Meanwhile, it generally indicates the subjects that are not eligible for loans. This makes it easy for commercial banks, if they do not have the goodwill to lend, to reject real estate customers' applications in a "correct" manner.

VARS analysis: It can be seen that if Circular 06/2023/TT-NHNN is applied, it will cause some of the following shortcomings:

Firstly, projects that are stuck in legal issues or lack capital are not eligible for further implementation. If they are not granted loans, the business is considered to be “frozen”, with no chance to turn things around.

Second, M&A is currently considered a channel that actively supports and opens a way out for businesses and the market. When investors encounter difficulties and are at risk of "drowning on a pile of assets", they can sell part of their assets to save the remaining assets. Thanks to that, projects have the opportunity to restart, and supply in the market also increases. However, Circular 06/2023/TT-NHNN risks making this activity more difficult.

Third, the regulations and procedures stated in Circular 06/2023/TT-NHNN still have many unclear points, which can easily cause more confusion in the market. This will prolong the market's stagnation period, affecting the market's "recovery" process.

From the above analysis, VARS has the best opinion that at this time, Circular 06/2023/TT-NHNN should be withdrawn and a decree should be researched and issued with content that closely follows and is in accordance with the spirit of Resolution No. 33/NQ-CP.

This Decree should go in the direction of: Clarifying the subjects eligible for loans, facing difficulties due to legal conflicts/ capital difficulties, forcing them to stop site clearance/ pay land use fees/ buy back difficult businesses.

Loan options for special subjects.

Monitoring mechanism, ensuring post-lending efficiency.

Lending procedures need to be detailed and clear.

Only base on what the law prohibits.

We should not ban what the law is not suitable for and is under review and adjustment.

To support the banking system to achieve specific and clear results, the bank's attitude towards real estate should be more decisive, proactive and flexible.

There are only about 2 weeks left until Circular No. 06/2023/TT-NHNN of the State Bank amending and supplementing a number of articles of Circular No. 39/2016/TT-NHNN dated December 30, 2016 of the Governor of the State Bank regulating lending activities of credit institutions and foreign bank branches to customers, will officially take effect. This is causing many new concerns for the Vietnamese real estate community in the context of many difficulties in the market.

Faced with this situation, Prime Minister Pham Minh Chinh recently requested relevant agencies to study and amend Circular 06 to increase credit access for businesses.

Specifically, the Prime Minister signed urgent dispatch No. 746/TTg-KTTH dated August 16, 2023, assigning Deputy Prime Minister Le Minh Khai to immediately chair a meeting with the State Bank and relevant agencies to study and amend Circular 06/2023/TT-NHNN, improving businesses' access to credit.

To continue to resolutely, promptly and effectively implement solutions to improve businesses' access to credit, the Prime Minister requested to have an open-minded spirit, listen to the opinions of businesses and people, ensure that policies when issued are correct, accurate, do not hinder development and are appropriate, and promptly handle problems.

Deputy Prime Minister Le Minh Khai was assigned to urgently chair a meeting with the Governor of the State Bank of Vietnam, leaders of the State Bank of Vietnam, the Ministry of Justice, the Ministry of Finance, and the Government Office to listen to reports and study instructions on amending and supplementing Circular No. 06 and unreasonable points of Circular No. 03/2023/TT-NHNN, and report to the Prime Minister before August 20.

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