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Ha Noi calls for social housing reform

Update: July, 24/2014 - 08:48
Apartment buildings for workers in Thang Long Industrial Zone in Ha Noi's Dong Anh District. Ha Noi has asked for a review of housing projects for low-income earners to overcome difficulties. — VNA/VNS Photo Hoang Lam

HA NOI (VNS) — The Ha Noi People's Committee has asked relevant departments to review the progress of social housing projects and report on when the projects will be completed, before July 25.

In particular, the committee stipulated that the report include a description of the challenges affecting projects currently lagging behind schedule and solutions to enable faster progress.

The committee also asked local authorities to update official housing statistics and provide more information on housing demand to authorities until 2020.

The work must be completed before July 31, the committee said.

According to the Ministry of Construction, demand for social housing has drastically risen and requires immediate attention. In HCM City, about 130,000 apartments are needed, while in Ha Noi, 110,000 apartments are needed for low-income families.

Currently, 35 projects tasked with building social housing facilities have been completed with total investment capital of VND6.02 trillion (US$283.9 million). Around 18,950 apartments have been given to low-income families, while more than 17,430 apartments have been built for workers in industrial zones at a cost of VND3.8 trillion ($179.2 million).

As many as 90 projects worth VND27 trillion ($1.2 billion) are under construction, while another 39 projects will provide a further 27,000 apartments to workers in industrial zones.

Obstacles to housing

Procedural complications have meant many low-income earners in Ha Noi have been unable to access privately-funded social housing available for rent. At the same time, State-invested housing facilities have showed signs of degradation.

The CT19A apartment building in Viet Hung Urban Area in Long Bien District was funded by the State budget to supply 515 apartments to low-income earners in the city. The subsidised rate for each 52-square-metre apartment is about VND1.5 million ($70) per month. But after five years, many parts of the building have started to deteriorate.

On the sixth floor, water is starting to leak, while cracks have appeared in all parts of the building.

Resident Nguyen Doan said leaks were especially bad during rainy days.

"Water covers the underground parking lot and the ceiling has peeled off. I'm afraid that it might collapse," she said.

Residents have also been informed that their rent will increase from VND29,100 ($1.3) to VND38,515 ($1.8) per square metre.

"My renting cost will increase from VND1.6 million ($75) to VND2.8 million ($132) per month. This is such a large amount for retirees like me," Pham Thanh Bang, another resident said.

Vo Vinh Nam, a representative from the municipal Construction Department's Urban Development Management Unit said the operation and maintenance of the building depended on the State budget.

"The city authority allocates about VND500 million ($23,580) each year for the work. This is not enough to do maintenance work for more than 500 apartments in the building", he said.

"We can only do some apartments and wait for the next year's fund," he said.

Many low-income earners have also struggled to gain access to the privately-funded Dang Xa house in Gia Lam District, where rent is around VND25,000 ($1.1) per square metre per month.

The current regulation stipulates that those wanting to rent accommodation in social housing facilities must have at least a one-year temporary residence permit and have paid social insurance for more than one year. In effect, they can only access this housing after they have gained employment and signed a contract.

Tran Anh Tuan, director of Viglacera Infrastructure Investment Development Company, the investor of the building, said many were not allowed to rent apartments because of the regulation.

He said that students were desperate to rent apartments but found it nearly impossible to meet the requirements.

Tuan said the Ministry of Construction needed to change the regulation to improve access to housing for low-income families. — VNS

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