Regulating the real estate market
The real estate market often faces many major challenges, from bad debt, high inventory... These difficulties not only directly affect the development of the market but also cause consequences for the entire economy.
According to the latest report of the Vietnam Association of Realtors (VARS), on the basis of maximum respect for the natural laws of supply and demand, it is extremely necessary for the State to proactively strengthen the regulation of the real estate market when the market shows "signs of instability".
According to VARS experts, the 2023 Law on Real Estate Business has provisions on the mechanism for regulating the real estate market in Article 79. This content is further clarified in Article 34 of Decree 96/2024/ND-CP. Accordingly, the Ministry of Construction will base on the price index, real estate transaction volume index and other socio-economic indexes and statistics of other sectors and fields related to the real estate market to assess the real estate market situation and propose market regulation.
Measures to regulate the real estate market are implemented when the real estate transaction price index fluctuates by more than 20% in 3 months or the real estate market has other fluctuations that affect socio-economic stability. However, to do this is not simple. Because our database is not really complete and accurate.
Use of credit law policies
According to VARS’s research from the experience of other countries, credit law policies are one of the important tools for governments to regulate the real estate market. Many of the policies that have been successfully applied by other countries can be completely referenced, learned, and applied to Vietnam.
Based on lessons learned from previous countries, VARS proposes a number of credit policy solutions to regulate the market when the market fluctuates by more than 20% in 3 months or the real estate market has other fluctuations that affect socio-economic stability without affecting people's demand for housing.
First, tighten credit policies for speculators. To reduce the number of people borrowing money for speculative purposes or using too much leverage, credit institutions can adjust lending limits by adjusting loan-to-value ratios, requiring higher equity payments, or applying higher interest rates to second-home buyers or more.
Second, strengthen credit supervision and management. The government can impose regulations on credit quality control, requiring banks to report more details on real estate-related loans, thereby strengthening risk monitoring. Establish a credit mechanism for social housing projects, prioritizing funding for social housing and affordable housing development projects to address the housing needs of low-income people.
In addition, the State also needs to have a policy of loosening credit, including reducing interest rates and supporting long-term loans with preferential interest rates for first-time home buyers, or some other priority groups for the purpose of social stability such as newly married young couples...
