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| Latest real estate: Image of a social housing area in Hanoi. (Source: VNA) |
No one has borrowed the preferential credit package of 120,000 billion VND
On May 19, the Ministry of Construction held a conference to deploy the project "Investing in the construction of at least 1 million social housing apartments for low-income people and industrial park workers in the 2021-2030 period".
Speaking at this conference, Mr. Nguyen Xuan Bac - Deputy Director of the Department of Credit for Economic Sectors (State Bank) said that up to now, the credit package of 120,000 billion VND for loans to investors and buyers of social housing, workers' housing, and apartment renovation and reconstruction projects under Resolution 33 of the Government dated March 11, 2023 has not generated outstanding debt.
Previously, the banking system had implemented a number of lending programs for social housing and housing for low-income people. For example, the social housing lending program under Decree 100/2015 as of March 31, the outstanding balance of the program reached VND 10,935 billion. This includes outstanding balance implemented under Resolution No. 43/2022 of the National Assembly and Resolution No. 11 of the Government dated January 30, 2022 of VND 4,381 billion.
Regarding the difficulties and obstacles in implementing the VND120,000 billion credit package, he said that currently, the supply of social housing and workers' housing is still limited due to the difficulties and obstacles mentioned in the Project to invest in building at least 1 million social housing apartments, such as those related to the selection of investors in social housing projects. Next, the land fund for social housing and incentives for investors in building social housing have not really attracted; determining the selling price of social housing...
"These problems may affect the supply of social housing as well as the progress of project implementation. To date, the State Bank has not received a list of projects according to the guidance of the Ministry of Construction. Therefore, although it has been implemented since April 1, 2023, there has been no outstanding debt under the VND120,000 billion loan program to date," Mr. Bac said.
In addition, according to Mr. Bac, regulations on conditions for purchasing social housing are also facing many complaints such as: Conditions on residence and conditions on income that are not subject to personal income tax are no longer suitable in the context of increasing housing prices.
In order for the VND120,000 billion loan program to truly come to life, contributing to the goal of building at least 1 million social housing units and housing for workers by 2030, the State Bank representative proposed that there needs to be coordination among ministries, branches, and localities.
In particular, ministries and branches review and amend relevant legal documents to remove legal obstacles, procedures and formalities in investment and construction of social housing and workers' housing, increase the supply of this real estate segment to the market, and meet the real needs of the people.
People's Committees of provinces and centrally run cities shall pay attention to and allocate land funds for social housing development. The list of projects shall be announced soon so that beneficiaries have access to loans from commercial banks.
Real estate prices drop, buyers still 'disappear'
According to the report of the Ministry of Construction, housing prices and some types of real estate fluctuated a lot in the first quarter. While apartment prices in Hanoi, Ho Chi Minh City and some other localities tended to fluctuate, with some decreasing and some increasing, the land segment had a very clear downward trend.
Land prices decreased significantly in Da Nang, Hai Phong, and Khanh Hoa. Land prices in existing projects also decreased by about 4.5-8% compared to the previous quarter, decreasing significantly in Dong Nai, Khanh Hoa, Da Nang, and Ho Chi Minh City.
According to the Ministry of Construction, the villa and project land segment in many localities is showing a downward trend and there are few transactions. The reason is that the prices are too high, customer confidence is still low, and interest costs are high.
The latest report on the real estate market in Ho Chi Minh City and surrounding areas just released by DKRA Group shows that after the first quarter with an absorption rate of only 63%, by April, many investors had applied a quick payment discount policy. In particular, there was a project that reduced the listed selling price of apartments by up to 52%.
However, the primary selling price level continues to be anchored at a high level due to pressure from input costs, interest rates, legal issues, etc. The decline in the secondary market has slowed down with liquidity recovering slightly due to information about policies to remove obstacles for real estate and cool down interest rates.
The price of primary apartments in Ho Chi Minh City is fluctuating between 67.1 - 76.7 million VND/m2. In Binh Duong, the price is around 37 - 46.8 million VND/m2.
Mr. Hoang Hai - Director of the Department of Housing and Real Estate Market Management (Ministry of Construction) assessed that the real estate market has not really recovered. Some investors have houses but are not ready to open for sale because they are afraid that the market is not good, affecting sales results.
Meanwhile, buyers are still in the mindset of waiting to “buy the bottom”. According to experts from DKRA Group, positive signals from banks showing signs of reducing interest rates, along with policies and support for the market in the first months of the year, have not been able to have a strong impact on liquidity in recent times.
Currently, buyers are waiting for the market to hit a "bottom" and lack confidence when putting money down. Not to mention, many people have also lost faith in the market, especially the legality of projects. In addition, many customers are hesitant in deciding to borrow money to buy real estate because interest rates, although reduced, are still high.
Market records show that secondary prices have dropped in most segments such as land, villas... Many projects in Ho Chi Minh City and the Southern region have even dropped by 40-45% in both the secondary and primary markets. However, liquidity is still very low.
Mr. Pham Duc Toan - General Director of EZ Real Estate Investment and Development JSC (EZ Property) said that the immediate price reduction wave will occur strongly in speculative segments that were inflated too high in the previous stage. Some segments will not decrease such as inner-city houses, urban areas with commercial advantages, and stable infrastructure because the real demand for housing is still very large.
According to Mr. Toan, suburban real estate products have not decreased much. There are very high-priced products that only meet the needs of a part of customers with economic conditions.
Regarding whether to put money down to buy a house at this time, Mr. Toan said that many factors need to be considered and calculated.
“The market in the first months of the year was slow due to the heavy psychology of customers, but in fact, the demand for real estate transactions is still very high. The government and localities are very interested in directing and directly considering resolving difficulties and obstacles of real estate projects. Open policies will ease the supply. When the supply is supplemented, prices will be more reasonable.
Currently, real estate prices are still high, such as old apartments in the inner city, which used to be 30 million VND/m2, now in some areas it is 40-45 million VND/m2, which is unreasonable. When the supply is diverse and abundant, there will be diversity in prices, buyers will have more suitable choices" - Mr. Toan said.
Restore investor confidence
Decree No. 10/2023/ND-CP issued by the Government is considered good news for the resort real estate market. Accordingly, hotel apartments, resort apartments (condotel), officetel, resort villas and other works serving accommodation and tourism on commercial and service land, if qualified, will be granted certificates of land use rights, house ownership rights and other assets attached to the land (red books).
Recently, on May 15, the Ministry of Natural Resources and Environment (MONRE) has just sent an official dispatch to the People's Committees of provinces and cities requesting them to review and issue documents under their authority to organize the implementation of Decree No. 10/2023. In particular, the Ministry requires localities to promote the issuance of "red books" for condotels, tourist villas, officetels, commercial services, etc.
Mr. Do Tuan Anh, General Director of KDI Holdings, investor of Vega City Nha Trang project (Khanh Hoa) said that Decree No. 10/2023 of the Government is an important step forward in creating a clear and transparent legal framework for types of resort real estate, especially condotels. Because this is a type with great development potential but has previously encountered many difficulties due to the lack of specific legal documents.
Economist, Associate Professor, Dr. Dinh Trong Thinh also said that the issuance of red books for this type of investment is very positive information, which will help strengthen the confidence of investors, especially when the real estate market has almost frozen recently.
According to Mr. Thinh, the recent dispatch of the Ministry of Natural Resources and Environment reminded and "urged" localities to issue red books. However, in order to implement it soon, Mr. Thinh said that the authorities need to have a circular with specific instructions on procedures, subjects...
Ms. Uyen Nguyen, Head of Consulting, Savills Hotels Asia-Pacific, commented that this is a positive signal to meet the huge practical demand, contributing to resolving the disputes between investors and customers in recent times.
However, according to Ms. Uyen, there will be a certain delay between the promulgation of the Decree and its implementation.
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| Red book separation (land plot separation) is an activity authorized by a competent State agency to divide a land plot with a red book into many different pieces but still meet the regulations on minimum area. (Photo: Ha Phong) |
Procedures for separating red books in 2023
Currently, many people have the need to separate the red book for many purposes such as buying, selling, and donating land use rights. However, many people still do not fully understand this procedure, leading to legal problems as well as wasting time.
Red book separation (land plot separation) is an activity of a competent State agency that allows the division of a land plot with a red book into many different pieces but still meets the regulations on minimum area.
Separating the red book can be for a number of purposes such as: Transferring part of the right to use land and assets attached to land; Inheriting part of the right to use land and assets attached to land; Donating part of the right to use land and assets attached to land; Mortgaging part of the right to use land and assets attached to land; Contributing capital in part by the right to use land and assets attached to land.
Conditions for separating the red book include: Must have a land use rights certificate; Must meet the minimum land area and land division limit; Must have permanent residents in the locality, no land disputes; Land is within the term of use; Ensure that it is not subject to seizure for execution of judgment.
When ensuring all the necessary conditions to separate the red book, people who want to separate the red book need to ensure all the documents and records including: Application for land separation; Land use rights transfer papers; Certificate from the People's Committee that the land is not in dispute and is in accordance with local planning.
After completing all the documents, the Land Management Office will be responsible for: Land surveying to separate the land plot; Preparing documents to submit to the competent authority to issue the Certificate of land use rights, house ownership rights and other assets attached to the land to the land user for the newly separated or merged land plot; Correcting and updating changes in the land records and land database; handing over the Certificate of land use rights, house ownership rights and other assets attached to the land to the grantee or sending it to the People's Committee for handover in case of submitting documents at the commune level.
The time limit for handling procedures for separating red books shall not exceed 15 days from the date of receipt of valid documents, excluding days off and holidays as prescribed by law; excluding the time for receiving documents at the commune, the time for performing financial obligations of land users; excluding the time for considering and handling cases of land use in violation of the law, and the time for requesting appraisal.
For areas with difficult conditions, the implementation time for each type of procedure prescribed in this Article is increased by 10 days, except for land dispute mediation procedures.
Land division survey fee: Fluctuates from 1.8 - 2.5 million VND.
Certificate issuance fee: Under 100,000 VND/certificate.
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