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The Ministry of Construction has just written in response to some recommendations of the Ho Chi Minh City Real Estate Association (HoREA) on mechanisms and policies for the development of social housing, cheap commercial housing in the city. Among them, the Ministry of Construction rejected a series of HoREA’s recommendations.
Specifically, HoREA suggested the Ministry of Construction allow businesses to invest in projects for rental apartments, motels, rooms for rent with a maximum area of 25sqm.
According to HoREA, if allowed to build apartments for rent with less than 25sqm, this will solve the problem of accommodation for the majority of low-income people living in Ho Chi Minh City. However, the Ministry of Construction affirmed that this pilot proposal is not suitable.
In accordance with Circular 20/2016 TT – BXD on June 30th 2016 of the Ministry of Construction, it stipulates the minimum area of a living room that is invested by households and individuals to build houses for sale or lease is 10sqm. The flat or house must have a minimum area of 25sqm.
The Ministry of Construction affirms that this regulation aims to encourage households and individuals to invest in social housing. For enterprises that want to build social houses, the minimum area is 25sqm and must be implemented according to the project that the land is allocated or leased by the State. At that time, the people are better living conditions.
In addition, investors of social housing projects are also entitled to preferential loans, exemption from land use fees, land rent, corporate income tax reduction.
Many real estate businesses have enjoyed this policy and are actively investing in the construction of social housing. Currently, many developers of commercial housing projects, social housing projects are providing 0% of interest rate support for home buyers to sell their products.
“Therefore, the proposal to increase the profit margin for the Association’s investors is not appropriate, making difficult for the poor and low-income people to buy or rent social housing,” the Ministry of Construction said.
Regarding the suggestion of the interest rate of loans for the purchase of social housing from 3 to 3.5%, the Ministry of Construction believes that the interest rate for providing social housing support under Decree No. 100/2015 / ND-CP is 4.8% and 5% per year now that is a great effort from the government. If the proposal to reduce interest rates, it is sure that the Ministries won’t agree due to the state budget cannot be arranged.
HoREA also recommends that social housing tenants only pay a deposit from one to three months rent. In this regard, the Ministry of Construction affirmed the law on social housing to stipulate the deposit for rent of at least 3 months.
The Ministry of Construction will study to issue when the Government has the program to amend Decree 100/2015 / ND-CP.
You are reading the article “The Ministry Of Construction Rejected The Proposal To Build A Rental Housing Of Less Than 25sqm” in the section “Real Estate News” on the website: https://realestatevietnam.com.vn/.
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