Removing procedures, increasing social housing supply

The project has many registrations but very few implementation

The Le Thanh Tan Kien social housing project in Binh Chanh district, Ho Chi Minh City is planned to be completed in 2026, providing the market with 1,445 social housing units under the form of 49-year lease, with an average area of 45-50m2.

Although the investor spent more than 5 years pursuing legal procedures and started construction in August 2024, the project is still an empty lot. The main reason is that the detailed planning approval process at a scale of 1/500 and the construction permit was too long.

Many other social housing projects in Ho Chi Minh City are also in a similar situation. For example, the MR1 social housing project in Tan Thuan Tay Residential Area (District 7) was broken ground by Xuan Mai Saigon Construction Investment Joint Stock Company 2 years ago. According to the plan, the project will provide more than 700 apartments for about 1,400 workers with average income. However, the project has not yet been implemented.

In 2024, the Ho Chi Minh City People's Committee also held a Conference on Promoting Investment in Social Housing Construction. There are 21 enterprises that have registered to invest in the construction of social housing at the land fund created by the enterprise with about 52,000 apartments.

Of which, 9 enterprises registered to invest at land addresses under the use rights of enterprises, with about 40,000 apartments; the remaining 12 enterprises registered and committed to finding land in the city to build social housing, with about 12,000 apartments.

The Ho Chi Minh City Department of Construction also announced a list of 7 projects calling for investment, with about 8,000 apartments. Combined with 10,000 apartments planned for investment, Ho Chi Minh City can develop about 70,000 social housing units by 2030, meeting the target of the Government's 1 million social housing units project.

However, from calculation to reality it is a long way, when up to now, only a few businesses have started implementing, others have plans that are still... on paper or new in the investment research phase due to legal problems.

Expectations for the new policy

Mr. Le Hoang Chau - Chairman of the Ho Chi Minh City Real Estate Association - said that the implementation of social housing policies is facing difficulties. Citing from Ho Chi Minh City, 100,000 social housing units have been assigned to be implemented, but in the 2021-2024 period, only more than 6,000 units have been implemented, meaning only 6%.

Mr. Chau also hopes that with the policies in the National Assembly's resolution, the time for social housing procedures will be shortened. For example, the mechanism of assigning investors and approving investment policies without auction will shorten the time that previously the enterprise had to spend from 1-3 months.

However, Mr. Chau also suggested: "How to get social housing buyers to borrow at the interest rate of 4.8% as before, but now 6.6% is too high and can be borrowed within 25 years".

Ho Chi Minh City leaders also admitted that during the process of implementing social housing projects, the city still faces many difficulties and problems in terms of resources, investment procedures, planning, granting construction permits, fire prevention and fighting, investor selection procedures, determining social housing prices... However, specific mechanisms such as in Resolution 201 will help to remove difficulties.

Specific policies on granting construction permits, exempting construction permits, and assigning shortened bids according to the provisions of the law on bidding will also help the city speed up the progress of social housing investment in the coming time.

The city will focus on working with project investors with a large scale of over 1,000 units, removing difficulties and obstacles for projects to speed up the progress of project implementation to soon complete and put into use.