Government support

In July 2022, a conference chaired by Prime Minister Pham Minh Chinh was held to discuss a safe, healthy, and sustainable real estate market in the future. The conference aimed at the current prevailing situation and highlighted the limitations and inadequacies of the entire real estate market in the country. Domestic and international experiences were brought forward with proposals for real estate and related fields to ensure that the market continued to develop in the most stable manner. At the conference, Prime Minister Phạm Minh Chính stated that the real estate market played a very important role in maintaining macroeconomic stability, controlling inflation, ensuring major balances, and promoting economic growth in the country.

On 29 August 2022, the Prime Minister issued Directive 13 for solutions to promote the safe and healthy development of the real estate market. Under Directive 13, the Prime Minister has proposed many solutions and specific tasks for ministries, sectors, and localities to solve difficulties, obstacles, shortcomings, and bottlenecks in the real estate market. This has been submitted to the National Assembly for opinion and approval of the Law on Housing, and Law on Real Estate Business, and to create a legal framework for business activities and enhance the efficiency of real estate market management. This will not unreasonably tighten credit but promote the development of social housing, housing for workers, and the rebuilding of old apartment buildings. It will control capital mobilization activities to avoid speculation, and manipulation of prices, besides preventing violations in auctions of land use rights.

The Government emphasized the need to take measures to manage and prevent division and subdivision, and the sale of plots in areas where investment is not permitted and lacks infrastructure. There is a need to strengthen control over illicit activities on real estate trading floors, among organizations, and individuals involved in real estate brokerage. There is also a need to correct flaws in the act of buying and selling and causing any misinformation in the market that could allow price fever and a real estate bubble to occur. It is also important to review projects that use the land but are slow to deploy or use the land for the wrong purpose.

Market in 2023

On 17 November 2022, the Prime Minister issued Decision 1435 for establishing a Prime Minister Working Group, under the guidance of Mr. Nguyen Thanh Nghi, Minister of Construction. The working group has been tasked to review, urge, guide and remove all difficulties and obstacles in the implementation of real estate projects in Hanoi, Ho Chi Minh City, and a number of other provinces and centrally run cities. All matters will then be reported to the Prime Minister for further direction and consultation.

On December 14, 2022, Prime Minister Pham Minh Chinh signed an Official Dispatch 1164/CD-TTg, requesting the Minister of Construction to implement the tasks of the Working Group actively and effectively. Accordingly, the Minister of Construction is responsible for coordinating with ministries and branches to direct and guide localities and enterprises to implement Resolution 11 on the program of socio-economic recovery and development. This calls for making a list of projects, reviewing land funds, completing legal procedures, selecting investors to implement social housing projects, housing workers in cities and industrial parks, and renovating and reconstructing of old apartments.

The Prime Minister has requested the Governor of the State Bank of Vietnam to direct, coordinate and guide localities, commercial banks, and related entities to organize the implementation of the Prime Minister's Official Dispatch 1156/CD-TTg dated December 12, 2022, on saving costs, reducing administrative procedures, and enhancing digitization to provide credit capital in a timely manner. The lending and disbursement must be made faster, with the right focus, for the right businesses, and for eligible real estate projects in accordance with the provisions of the law. Priority must be given to loans at suitable rates for social housing projects, workers' houses, and commercial housing.

The Prime Minister has requested the Minister of Natural Resources and Environment to actively review and complete legal documents according to competence, as well as to provide guidance. Cases beyond their competence must be submitted to the Government for the promulgation of a decree to amend and supplement a number of articles for guiding the implementation of the Land Law, in order to remove difficulties in implementing market development and real estate projects. The Minister of Planning and Investment will direct and coordinate with agencies and units to urgently review, amend, and promptly supplement regulations and laws on investment and bidding to remove difficulties and obstacles in approving and adjusting investment policies and bidding for real estate projects.

The Prime Minister has also asked the Chairmen of the People's Committees of the concerned provinces and cities to urgently review and make a list of commercial housing, social housing, and real estate projects in the area. The Prime Minister has also called for assessing specifically the reasons for each project that has been approved for investment policies but has not yet been implemented or is slow to implement, in order to proactively handle according to competence or report and propose specific and clear problems. Inadequacies that need to be removed in case of exceeding authority must be dealt with firmly. The focus must be on solving legal difficulties and procedures to prepare investments in real estate projects, and housing projects to increase supply for the market. These actions must be reported to competent authorities to settle cases beyond the ability of localities.

For real estate businesses and related businesses, the Prime Minister has requested to proactively restructure customer segments, products, prices, payment terms, and payment methods, so as to ensure better feasibility and convenience for customers and people, especially those with real housing needs.

Source: SGGP/Saigon Investment