Early commencement of social housing projects in some localities
Speaking at the Conference on Removing Difficulties and Promoting Social Housing Development chaired by the Prime Minister on the morning of March 16, Mr. Nguyen Viet Quang - Vice Chairman of VinGroup Corporation said that recently, Vinhomes Company of VinGroup Corporation has started construction of 4 social housing projects in Hai Phong, Thanh Hoa, Quang Tri and Khanh Hoa.
It is expected that upon completion, these projects will add more than 10,000 social housing apartments and housing funds in localities. At the same time, VinGroup is also continuing to carry out legal procedures to be able to soon start construction of social housing projects in Hanoi, Hung Yen, Ha Tinh, Ho Chi Minh City and other provinces and cities.
Through practical implementation, Mr. Quang commented that the Government has had many mechanisms and policies to support the development of social housing, creating a relatively complete legal corridor to support and encourage businesses to participate in and develop social housing.
Many social housing projects are exempted from land use fees, reduced by 50% in value added tax and corporate income tax; supported to invest in technical infrastructure inside and outside the project; provided with preferential loans with low interest rates and policies to support customers and individuals borrowing, buying and renting social housing.
Mr. Nguyen Viet Quang - Vice Chairman of VinGroup Corporation spoke at the Conference.
Besides the positive points, a representative of VinGroup Corporation said that the implementation of social housing construction still faces many challenges.
Regarding procedures for implementing social housing projects , the number of social housing procedures is currently greater than that of commercial housing projects.
“In addition to general procedures such as planning approval, investment policy approval, bidding to select investors; land allocation and land lease, social housing projects require additional procedures for confirming subjects eligible to buy and rent social housing; procedures for appraising selling prices and rental prices of social housing. This leads to prolonged procedures for implementing social housing. The total time to complete procedures for social housing projects from the beginning of implementation to the commencement of construction is usually about 2 years,” said Mr. Quang.
Regarding the incentive mechanism for commercial service items within the scope of social housing projects, Vingroup representative said that in order for social housing projects to truly be modern, civilized urban areas with full amenities to improve people's lives, in addition to improving the quality of social housing, the synchronous construction of technical infrastructure, social infrastructure, and commercial services to serve people is very necessary, especially large-scale social housing.
However, the support policy for investment in construction of these projects is not clear. Therefore, if the investor implements synchronous investment in these projects, it will easily lead to increased costs and increased selling prices of social housing.
Regarding capital investment in social housing , based on the review, capital investment in high-rise housing construction is currently lower than capital investment in commercial housing. Meanwhile, the actual cost and capital investment of commercial housing is higher than the prescribed investment capital.
Mr. Quang said that this affects the quality of social housing projects and causes difficulties in revenue for social housing project investors because the determination of selling prices must be based on investment capital.
Regarding capital sources for investment in construction, purchase and rental of social housing , in reality, access to loan sources is still not favorable. In addition, the preferential interest rate for investment in construction as well as for rental and purchase of social housing is currently high. For investors, the interest rate is 8%/year, for customers buying social housing is 7.5%/year.
Also sharing about the above issue, Mr. Nguyen Van Thanh Huy - Deputy General Director of Becamex Corporation said that up to this point, the Corporation has implemented over 45,000 apartments, both worker housing and social housing, and also clearly identified that in the beginning, it will focus on developing worker housing to stabilize the lives of workers in the provinces who come to Binh Duong to work.
In Binh Duong, workers' housing is mainly for rent, but Binh Duong's social housing is aimed at stabilizing general social security, meaning workers own it. In 2024, Binh Duong province will continue to prioritize the construction of 10,000 social housing units.
“In the first quarter of this year, we will start construction on 2,000 apartments. Regarding capital, the province prioritizes balancing resources and calling for support from commercial banks to deploy and implement these projects,” said Mr. Huy.
Loan interest rates remain high
In order to attract investors to participate in social housing investment projects and reduce social housing prices, from a business perspective, Vingroup representatives made some recommendations.
First, consider minimizing procedures related to investing in the construction of social housing projects.
Second, promulgate a list of technical infrastructure and social infrastructure items that are supported by the budget for investment, and exempt land rent for commercial service areas within the scope of social housing projects.
Third, readjust investment capital for social housing projects to suit reality.
Fourth, research and adjust lending interest rates for investment in construction as well as for purchase and lease of social housing. Based on the budget, consider or compensate for the difference in interest rates if investors see customers borrowing capital from commercial banks to invest in construction and lease and purchase social housing.
Mr. Nguyen Van Thanh Huy - Deputy General Director of Becamex Corporation.
Becamex representative also stated that in the process of implementing social housing projects, Becamex encountered the problem of high interest rates for workers and secondly, the loan period for workers was still short.
"Through monitoring and research, if we extend the loan period for workers, it will create great conditions for workers to own social housing," Becamex representative proposed.
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