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PM urges faster social housing project approval process

The Saigon Times

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HCMC – Prime Minister Pham Minh Chinh has called for action to streamline the approval process and lower interest rates for social housing projects.

At a conference held on March 16 to find ways to tackle challenges and step up the development of social homes, Chinh stressed the need for relevant ministries to devise solutions to trim the approval process and cut interest rates to facilitate social housing projects.

Highlighting the favorable policies already in place for social housing projects compared to other types of housing, he emphasized the importance of understanding the perspectives of potential homebuyers. He urged all stakeholders to take proactive measures to improve the situation.

However, a Ministry of Construction report said that social housing projects continue to encounter obstacles. In Hanoi, for instance, only three projects are underway, providing 1,700 apartment units, meeting just 9% of the demand. Similarly, seven projects in HCMC supply 4,996 units, covering only 19% of the total demand.

During the conference, real estate businesses voiced concerns over complex approval procedures and challenges in site clearance. They also highlighted the issue of social housing projects being situated far from city centers, deterring potential buyers.

According to these businesses, social housing projects should receive better preferential interest rates, increased lending duration and streamlined lending procedures as these incentives will make projects more attractive to investors and home buyers.

To address challenges faced by social housing projects, the PM tasked relevant ministries with introducing more favorable regulations. These efforts will focus on streamlining bureaucracy and decentralizing power to expedite approval processes and reduce implementation costs.

Under the directive, the Ministry of Construction will lead efforts to simplify contractor selection procedures, while the State Bank of Vietnam (SBV) will instruct commercial banks to explore plans for lowering interest rates by 3% to 5% and extending lending durations to 10 or 15 years for social housing projects.

From 2021 to 2023, the country saw the implementation of 499 social housing projects, providing 411,250 apartment units, according to a report from the Ministry of Construction.

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