Social housing supply and demand imbalance
The Ly Thuong Kiet social housing project in Dien Hong ward, Ho Chi Minh City recorded more than 12,000 applications for about 750 units, reflecting a large demand but limited supply. Mr. Nguyen Van Hoan - Deputy Head of Urban Development Department - Ho Chi Minh City Department of Construction - said that from the beginning of 2025 to now, only 1 social housing project has been completed with 560 units, 2 projects have started construction with a scale of 2,600 units, and 12 projects are currently under construction with a total of 10,300 units. Before April 30, some more projects will start construction, adding 4,600 units. By the end of 2026, Ho Chi Minh City is expected to start construction of 41 projects, providing about 28,500 social housing units. The Department of Construction is reviewing the land fund to supplement, helping Ho Chi Minh City have 72 projects and 76,000 social housing units in the next 2 years.
Ho Chi Minh City People's Committee has just agreed on a 7-step social housing project procedure process, with a total time of 132 days for private projects. However, according to Mr. Le Huu Nghia - General Director of Le Thanh Company, although procedures have been shortened, it still takes about 2 years due to having to solve many arising problems, from investment approval to construction permit, requiring the coordination of many departments and branches.
Although the regulation exempts appraisal of basic design reports to shorten the process, in reality, social housing projects encounter the situation of "both reviewing and licensing" overlapping. The Ho Chi Minh City Department of Construction regularly reviews the design, even though it has been independently inspected by consultants, causing businesses to re-implement the process whenever there are minor adjustments. This makes social housing have to perform two licensing steps, while commercial housing only needs one step.
Or like the planning "out of sync" with reality, so businesses make efforts to push up population targets to suit social housing projects, but often encounter the scene of incompatible planning, leading to spending at least 3 years just waiting for adjustments.
Mr. Le Hoang Chau - Chairman of HoREA - said that the Government is promoting the program of 1 million social housing units with practical support policies, but there are still many bottlenecks that need to be removed to support investment businesses.
Social housing businesses still have difficulty accessing preferential loans
Speaking about the story of borrowing capital to build social housing, Mr. Le Huu Nghia - General Director of Le Thanh Company - said that social housing is the most difficult borrowing object in real estate segments.
It is known that Le Thanh Company currently has a 2,000 billion VND project that has completed the foundation, but the implementation situation is "stalling" because it cannot borrow money. Mr. Nghia said that the Government's 140,000 billion VND credit package is a preferential program to develop social housing and worker housing assigned to 9 commercial banks to implement. This package has an interest rate lower than market interest rates, not included in the credit room, applied to both investors and homebuyers with a loan term of up to 20 years.
However, when this business contacted banks to apply for loans at the current preferential loan interest rate for social housing of 6.1%, it was refused. The reason given by banks is that the current deposit interest rate is too high, if lending at a rate of 6.1%, it will be a loss. Even when the business proposed to borrow at the interest rate of commercial housing, the bank did not agree, because of concerns about prosecuting responsibility for lending to the wrong subjects. This has put his business in a dilemma.
