Minister of Finance: There needs to be a price ceiling for social housing

Minister Ho Duc Phoc said that social housing invested by the State or enterprises needs "State price approval" and price ceiling regulations.

On the morning of June 5, after listening to the presentation and examination, the National Assembly discussed the draft Law on Housing (amended) in the group. The determination of selling, renting and leasing prices for social housing received many comments from the delegates.

Finance Minister Ho Duc Phoc analyzed that currently social housing is invested by the State or built by enterprises. He said that in the case of social housing projects invested by the State, meaning money is taken from the budget, the draft law needs to clearly stipulate that the People's Committee of the province or city has the right to assign the investor to implement and "is the one to set the selling price and rental price".

"Social housing land is not charged, of course when the State does it, it will regulate the selling price for those who are eligible to buy social housing," said the Minister.

In the case of enterprises investing in social housing, Mr. Phuc said the State also needs to approve the price. He analyzed that enterprises invest capital, but the land is allocated by the State, clean land, no land use fees are collected, the State must control the maximum selling price. Thus, social housing can be sold and rented to the right subjects. Otherwise, it will fall into the "channel" of commercial housing.

"The State must decide on the price of social housing. Projects invested by the State must sell at the right price, while businesses investing in them must set a maximum price, or ceiling price. When selling at the maximum price, businesses will save more and make a profit," he said.

Minister of Finance Ho Duc Phoc speaks at the meeting on the morning of June 4. Photo: *Hoang Phong*

Mr. Nguyen Tuan Thinh, Deputy Director of the Hanoi Institute for Socio-Economic Development, commented that social housing prices are not consistent with the Law on Prices. Accordingly, this law stipulates that social housing that does not use state capital or is invested by the private sector is still within the scope of state pricing.

Meanwhile, in the draft Housing Law, investors of social housing projects develop plans for selling and renting prices and submit them to the provincial specialized agencies for appraisal at the time the housing is eligible for sale. According to Mr. Thinh, the pricing regulations between the two laws are contradictory, and he suggested that the drafting agency review them to ensure consistency between the laws.

According to the draft law, the selling price of social housing is determined based on calculating all costs to recover investment capital for housing construction and reasonable costs of enterprises such as sales organization costs, business management costs, and other reasonable costs.

This regulation received the approval of the majority of opinions in the examining body - the Law Committee of the National Assembly. However, this body believes that it is necessary to clarify the principles and conditions for costs to be considered reasonable when included in the selling price. This is to strictly control the selling price, rental, and lease-purchase of social housing on the basis of harmonizing the interests of the State, investors, and people.

According to current regulations, enterprises participating in social housing investment enjoy some preferential policies on loans, the selling price still has to be approved by the management agency with a profit ceiling of 10%. This makes enterprises not interested in investing in social housing because the profit assessment is not attractive. However, there is currently no regulation on the price ceiling of social housing.

The National Assembly is expected to discuss the Housing Law (amended) in the hall on June 19.

Anh Minh - Son Ha

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