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Higher Real Estate Prices Push The Dream Of Living In The Urban Poor Far And Far

It is recognized by Le Hoang Chau, chairman of the Ho Chi Minh City Real Estate Association. According to Chau, cheap housing last time did not meet expectations and needs of people, in addition to supplying products must have credit attached to support low-income house buyers.

At the meeting with the Department of Industry (Central Economic Commission), Le Ho Chau, HoREA’s chairman, said that the city had a 37 percent increase in immigration in recent times. Currently, the population has grown to 13 million, so people’s housing needs are very large.

However, the money flowing into the real estate is the order phase, towards higher-end real estate. Meanwhile, social housing, cheap rental housing is in demand without any incentive policy to attract business participation to meet the demand.

Mr. Chau said that in Ho Chi Minh City, there have been private residential investment products priced at only $300 to $600/sqm, rental house 49 years but these developers are not supported and there are very few of them. Meanwhile, the construction of social housing investors no longer the source of credit support led to having to pay the project. On the other hand, the role of the social policy bank in creating this flow of credit is also ineffective.

increase real estate price
Housing small area that property prices soaring overtime pushed the dream of living in the urban poor far more.

Not only lack of supply of affordable housing or small area housing but the increase in real estate prices over the past time is pushing the dream of living in the urban farther.

Mr Chau, for example, said that Korean house prices are five to six times more expensive than people’s incomes. Meanwhile, affordable housing in our country is 20-25 times higher than middle-income earners. This shows that housing prices in Viet Nam are too much forbearance compared to the majority of low-income workers in the whole society.

“Cheap housing last time did not reach as expected and demand people. In addition to the supply of products must have credit to support low-income home buyers,” said Chau.

At the meeting, some investors in Ho Chi Minh City said that not creating momentum to develop cheap housing and rental housing, the urban poor will still not be able to buy a house.

“Poor workers can afford to buy a house because the social housing fund is mostly for civil servants, and the $1,3 billion package is for middle-income people. The poor are being abandoned. I have been struggling to make a small house, this will help the poor to access housing, “said Nguyen Van Duc, deputy director of Dat Lanh Real Estate.

Also, according to Mr. Ho, blanket projects in Ho Chi Minh City are not only leaving big debts from banks, government, partners … and customers but also waste of land, while the poor have not a house. There are about 500 “blanket” projects in Ho Chi Minh City, which cost hundreds of thousands of hectares of land.

increase real estate price
Poor workers can afford to buy a house because the social housing fund is mostly for civil servants, and the $ 30,000 billion package is for middle-income people.

Also according to the Ho Chi Minh City Real Estate Association, from 2016 to now the real estate market is slowing and declining. The phase away potential risks to the market, luxury real estate from resort to residential real estate is alarming. In addition, the phase-out of cash flow (credit and mobilization among the population) is also unbalanced when sources of money attracted to large projects, large enterprises.

Truong Thi Hoa lawyer, HoREA’s vice president said that citizens have the right to legal residence. Therefore, it is necessary to have a unified legal mechanism and corridor in order to incorporate laws, regulations and decrees for enterprises to implement easily.

Same idea, Mr. Nguyen Van Duc said that the construction of affordable social housing, rental housing is very necessary for people, especially migrants in Ho Chi Minh City today. Specifically, the State should soon put the standard to allow the construction of commercial premises of 25sqm, not only for the poor to worry about housing.

To develop the real estate market, more convenient, in the immediate need to reduce the administrative procedures. There are no branches that involve many sectors such as real estate industry that makes the business tired. Therefore, it must be clearly decentralized in the district. Reducing the cumbersome procedures of licenses, which in particular allows enterprises to implement the project when planning 1/500 rate” he said.

Le Xuan Thanh, Director of the Department of Industry of the Central Economic Commission, said the comments made by HoREA and the business communities are very relevant. These comments will be gathered and recorded by the members of the group to advise the Government on the early implementation of these contents through the provision of opinions on the formulation of decrees, laws, etc…

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Higher Real Estate Prices Push The Dream Of Living In The Urban Poor Far And Far
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