HÀ NỘI — The Ministry of Construction has sent a document to the Prime Minister proposing to supplement a loan package worth VNĐ3 trillion (US$132 million) to resolve difficulties in social housing projects.

Minister Phạm Hồng Hà said the supplemented capital would facilitate poor and low-income people as well as workers in industrial zones to buy or rent apartments undersocial housing projects.

The social housing project has met with some 30 per cent of the target. The country has completed 186 projects with 75,500 apartments, equivalent to 3.78 million sq.m, Hà said.

He added that the development of social housing had been slow due to difficulties. One of the factors has been the shortage of capital from the State budget for such projects as stipulated in the Housing Law 2014.

The State budget allocated through Việt Nam Bank for Social Policies (VBSP) in the 2018-20 period is more than VNĐ1.2 trillion, meeting 13 per cent of the demand.

In 2018 alone, the bank was supposed to be provided VNĐ500 billion for social housing projects. However, the money has not yet been disbursed.

According to Hà, the money will be enough to lend to households and individuals who wish to buy an apartment under social housing projects but not for investors.

He said there had been no capital to lend to social housing projects since the termination of the VNĐ30-trillion housing stimulus package at the end of 2016.

According to reports of localities, there are 206 social housing projects with some 168,700 apartments, covering an area of 8.43 million sq.m, whose construction has either been delayed or is progressing slowly.

Some investors have been asked to change their social housing projects to commercial ones. A modest number of social housing projects have become operational.

Meanwhile, some localities have not paid attention to the development of social housing. Many investors have failed to build small apartments at low prices, which is why the apartment supply structure has not been balanced. This has made it difficult for poor households and people with low income to have their own apartments.

The ministry has received feedback on capital supplementation of the projects from National Assembly deputies, localities, businesses and the public.

It has submitted the feedback to the government for review to supplement the capital in the public investment plan for the 2016-20 period.

It has also proposed to provide VNĐ3 trillion to VBSP and more than VNĐ3.4 trillion to credit institutions.

The HCM City Real Estate Association on Wednesday sent a document to the Prime Minister to quickly resolve the ministry’s proposal to effectively implement social housing policies for 2018-20.

Currently, the preferential interest rate of loans for social housing projects is five per cent per year at banks assigned by the government and 4.8 per cent per year at VBSP. The interest rate difference for credit organisations granting loans to social housing projects is three per cent per year and has been applied during 2016-20. — VNS