From the beginning of 2024 until now, in Ho Chi Minh City, only one groundbreaking ceremony was held for the Le Thanh Tan Kien social housing project (Binh Chanh district) with a scale of nearly 1,500 apartments.
It is worth mentioning that it took more than 5 years from March 2019, when Le Thanh Company submitted its application for an investment policy decision, for the Le Thanh Tan Kien social housing project (Binh Chanh District, Ho Chi Minh City) with an area of more than 3 hectares to officially start construction at the end of August.
The reason for the long time to complete legal procedures is that during the project implementation process, Le Thanh Company had to wait a long time to complete the investment approval procedures because it had to go through the stage of asking for opinions from relevant departments and branches, then wait for more time to adjust the planning to enjoy incentives for increasing planning targets.
This is a rare new social housing project that will start construction in 2024, in addition to the social housing project for workers to rent that is being built by Thu Thiem Joint Stock Company.
Mr. Bui Xuan Cuong, Vice Chairman of the Ho Chi Minh City People's Committee, said that from now until April 30, 2025, Ho Chi Minh City will focus on removing difficulties and obstacles and completing procedures to start construction of 5-6 social housing projects with a scale of about 6,000 apartments.
Mr. Le Huu Nghia, General Director of Le Thanh Company, said that to complete the legal procedures for this social housing project, the enterprise has been pursuing for nearly 5 years with a series of processes and procedures to do.
Mr. Nghia expects that the new Housing Law will remove obstacles in project development procedures, helping projects complete legal procedures and start construction and sales.
Currently, it is not certain that the supply of social housing will increase sharply this year, but social housing construction enterprises are also very hopeful after the Government issued Decree 115/2024 in September to replace Decree 31/2024.
In which, investors are not required to have both the decision approving the investment policy and the approval, investors can still continue to approve the detailed planning at a scale of 1/500, before continuing with the procedures for land allocation, land lease, land use fee calculation, land rent at the Department of Natural Resources and Environment, helping to untie all social housing projects and most commercial housing projects that cannot meet this requirement from 2021 to present.
From August 1, 2024, after Decree 100/2024 takes effect, localities across the country have had a "common model" on investment procedures from policy proposal, planning approval, investment policy approval, investor selection...
to the final stage, instead of each place having its own style as before.
It can be seen that a more complete legal corridor is helping to increase the supply of social housing, but besides that, experts also believe that purchasing power in the market still needs to be promoted by appropriate support policies.Dr. Nguyen Duy Phuong, Investment Director of DG Capital, expressed the view that for a social housing project to be successful, the output factor - that is, purchasing power - is the most important.
However, customers are currently facing financial problems as preferential interest rates for social housing at the Social Policy Bank have suddenly increased sharply.
The increase in interest rates for social housing loans from 4.8%/year to 6.6%/year is a huge increase.Social housing buyers had not anticipated this increase before, so this is a huge pressure.
