HCMC – The Ministry of Construction is mulling a VND30-trillion loan package for social housing development, said Vuong Duy Dung, deputy director of the Housing and Real Estate Market Management Agency under the ministry, at a press conference on October 17.
Dung said loans from this package would be provided through the Vietnam Bank for Social Policies and that the package would help realize a Government scheme to build at least one million social homes for low-income earners and factory workers by 2030.
Such preferential loans can be used to buy, rent, build and repair homes.
According to the ministry’s plan, half of the package would be sourced from the Government’s bond sales and the rest from local budgets.
Earlier, the Government introduced several financial measures for social home development, including a VND120-trillion loan package launched in March 2023 to boost social housing development.
However, despite two interest rate cuts by the State Bank of Vietnam, this package has struggled to attract borrowers. Dung attributed the low uptake to the short periods of low interest rates being extended, with three years for developers and five years for individual borrowers.
Moreover, commercial banks involved in the current package have been reluctant to disburse loans due to concerns about maintaining profit margins and mitigating risks under credit laws. The absence of state budget support for the VND120 trillion package further complicates the issue, as it places an additional financial strain on these banks, Dung added.
In response, the ministry is planning to propose a new VND30 trillion loan package to better address social housing needs. “This proposal, compared to the current VND120 trillion package, is more aligned with the state’s political and social welfare objectives,” Dung said.
