10 years ago, the real estate market was difficult, the Government had a support package of VND 30,000 billion. This capital was not large compared to the total outstanding loans at that time, but it contributed to solving many problems, creating a source of capital, stimulating consumption, and promoting the development of the real estate market. Therefore, the expert suggested that there should be specific capital sources for the real estate market.
Speaking at Forum on sustainable development of the real estate market in 2022 Organized by Business Forum Magazine in collaboration with relevant authorities, Mr. Nguyen Manh Ha – Vice Chairman of Vietnam Real Estate Association said: “The real estate market is especially difficult, especially in the last months of the year. Before that, in the first and second quarters of this year, the market still had a lot of hope.”.
According to Mr. Nguyen Manh Ha, 10 years ago, the real estate market faced similar difficulties as it is now. That is increasing bad debt, poor liquidity, the market has almost no transactions due to large inventory, the structure is not suitable for the market. Currently, the supply is limited, especially there is no housing in the mid-end segment, social housing, and worker housing.
Market difficulties have been identified. Those are issues related to the legal regulations on land, capital, planning and construction investment procedures. In particular, land “bottlenecks” related to site clearance and land price regulations make it difficult for localities to implement the order and procedures for land valuation.
Regarding capital sources, although the bank has been allowed to expand the credit room, the ability of businesses and people to access capital is still a question.
According to the Vietnam Real Estate Association, the Government has been very drastic to remove difficulties for the real estate market and set up a working group, but Mr. Ha said that the working group needs to work more effectively and directly with the difficulties of enterprises, also with the locality to solve the difficulties of enterprises.
In the immediate future, the working group needs to gather a list of difficult projects in the locality, classify the difficulties that the project is facing: projects facing ground clearance, projects facing problems due to land valuation, projects in progress. but “capital bottlenecks”… from there, there is a specific solution.
For example, with a project in the South, agricultural land is consolidated into a project that is in line with the planning and land use plan, but cannot be implemented due to difficulties in bidding regulations because the contract cannot be assigned. Therefore, depending on the specific project, the investor is allowed to deploy and appoint the investor with a land price suitable to the market price.
Or the problem of land pricing, each locality does it differently, there are localities according to the market, close to the market. The transaction price invites the consulting team to implement the methods of determining future revenue and determining according to the price. But determining a specific price, later on when the inspection bar turns the problem over, it can become a problem, so the pricing story is difficult.
Therefore, according to Mr. Nguyen Manh Ha, this is the time to rethink the issue of valuation according to the local general price level to make land valuation easier. Currently, 70-80% of businesses are involved in slow land valuation, many projects do not pay land use fees, so they cannot be implemented.
The next issue mentioned by Mr. Nguyen Manh Ha is capital. 10 years ago, the real estate market was difficult, the Government had a support package of VND 30,000 billion. This capital was not large compared to the total outstanding loans at that time, but it contributed to solving many problems, creating a prime source of capital, contributing to stimulating consumption, promoting the development of the real estate market, other industries such as building materials, creating jobs for construction workers.
Also about the capital source, Mr. Nguyen Quoc Hiep – Chairman of the Contractors Association said that the data published by the state bank showed that the credit zoom still had a surplus of 1-1.2% and added 1.5%, so the room is still but the problem of how businesses approach is the problem.
In general, the Prime Minister has given drastic instructions, the banks have loosened the room, but the implementation of the approach still has many problems. Forecasting credit sources for the real estate market in 2023 is still very difficult.
“The main “blood source” real estate project is still credit, but the current high interest rate is extremely difficult,” said Mr. Hiep.
Therefore, the representative of the Vietnam Real Estate Association made a proposal to have specific capital sources for the real estate market, especially for social housing, worker housing, and commercial housing at current low prices now.
| 16/12/2022
