According to a report by the Ho Chi Minh City Department of Construction, the city has 474 old apartment buildings built before 1975. Of these, 16 are class D (severely damaged and dangerous), of which 14 were inspected in the 2016-2017 period, and are now increasingly degraded and dangerous. However, the renovation of old apartment buildings has encountered many difficulties over the past decades.
The question is whether the newly amended important laws such as the Land Law, Housing Law and Real Estate Business Law, which all took effect from August 1, can resolve the difficulties and obstacles in this work, especially the story of harmonious interests between investors and residents, when the majority of apartment owners want to resettle on the spot. The second issue is the planning of apartment building heights in large cities such as Hanoi and Ho Chi Minh City.
Another current difficulty is capital, when businesses investing in rebuilding old apartments do not have enough money to completely build and hand over to residents, while residents are unwilling to invest with businesses.
According to the new regulations, investors in old apartment projects are entitled to a profit of 10% - 15%, not fixed at 10% as before. Enterprises selected as investors in old apartment renovation projects are proposed to adjust the project such as increasing the number of floors of the project.
According to Mr. Le Hoang Chau, Chairman of the Ho Chi Minh City Real Estate Association, the compensation and support mechanism for renovating and rebuilding old apartments is now more equitable between the owners of old apartments and the investors of the project to renovate and rebuild old apartments. The temporary housing mechanism in renovating old apartments is also synchronized in both the Land Law and the Housing Law, thus facilitating the demolition and reconstruction of buildings. For people living in old apartments, the new mechanism also protects the maximum interests of residents.
Another noteworthy point in the policy of renovating old apartments in the coming time, according to Mr. Chau, is the mechanism of collecting small collective houses that cannot be rebuilt on the spot, creating conditions for residents to resettle on the spot in the ward and district. This mechanism has just been applied by Ho Chi Minh City when renovating the Ga - Gao market collective housing area (District 1). The area of this collective housing area is about 2,000m2 but there are hundreds of collective housing units (about 8 - 15m2/unit) renovated from old market stalls.
