A social housing project in Mệ Linh District, Hà Nội.—VNA/VNS Photo

HÀ NỘI — Văn Hùng, 40, a security guard living in Hà Nội, has not been able to buy a social housing apartment despite three months of trying.

Hùng said it now costs about VNĐ28 million (US$1,198) per sq.m in an old social housing apartment.

“It’s too expensive for an old social housing apartment like this,” he said.

Hùng said six years ago, one of his friends bought a social housing apartment in Long Biên District with a price of only VNĐ13 million ($556) per sq.m.

The price of a social housing apartment, even an old one, has continuously increased, causing difficulties for many low-income people in the city who want to buy a social housing apartment. 

Mai Anh, 38, a kindergarten teacher in Hà Nội, said it is not easy to find new social housing projects in the city right now.

A real estate broker has recently presented to her a new social housing project in Nam Từ Liêm District with a price of VNĐ19-20 million ($812-855) per sq.m, she said.

However, the broker also told her to pay an additional fee of about VNĐ280 million ($11,983) to buy an apartment, she added.

The broker told her that there were thousands of dossiers sent to the investor asking to buy social housing apartments now. She said an additional fee was required if she wanted to be selected.

A 68-sq.m apartment in the social housing project costs about VNĐ1.63 billion ($69,700), she said.

The same situation has also happened to other social housing projects in the city. For example, apartments at the Vesta Phú Lãm social housing project in Hà Đông District cost about VNĐ15 million ($641) per sq.m before 2018; now it costs VNĐ23-27 million ($983-1,154) per sq.m.

Apartments of the social housing project IEC Residences Tứ Hiệp in Thanh Trì District cost VNĐ16-17 million ($684-727) per sq.m in 2021, currently, it costs VNĐ24-27 million ($1,027-1,155) per sq.m.

Apartments of Đồng Mô Đại Kim social housing project in Hoàng Mai District cost VNĐ14 million ($599) per sq.m in 2016. However, it now costs up to VNĐ30 million ($1,283) per sq.m.

Apartments of the Tây Nam Linh Đàm social housing project in Hoàng Mai District also had a starting price of only VNĐ13 million ($556) per sq.m in 2016, but now it costs VNĐ31 million ($1,324) per sq.m.

Causes

Võ Hồng Thắng, Deputy Director of R&D DKRA Việt Nam told to Zing online newspaper that there are three main causes of the situation.

The first is about legal issues. It often takes a long time for a social housing project to be approved by authorities, causing an increase in costs, including operating and opportunity costs. He said all of the above items have contributed to raising the selling price of the apartments.

Next is the issue of capital. A sharp increase in bank interest rates recently is also believed to be one of the reasons, he said.

Finally, it is due to a severe increase in input costs. He said that land prices, labour costs and raw materials have all increased sharply in recent years.

Besides, he said it still does not have many mechanisms and policies to support and guide the application of preferential loan packages for investors when they participate in social housing development.

Therefore, the price level of social housing apartments is thought to decrease hardly in the future, he added.

Statistics from the Ministry of Construction showed that the country had only nine newly-licensed social housing projects last year.

The report of BHS Group said that Hà Nội had no new apartment projects for sale in the first three months of this year. Most of the new supply comes from the next sale of existing projects.

In HCM City, DKRA's report revealed that the market had not recorded new commercial housing projects priced below VNĐ35 million ($1,494) over the past three years.

Plan

Under a new initiative approved by Deputy Prime Minister Trần Hồng Hà, more than one million homes will be built for the country's low-income and industrial park workers by 2030. 

The project aims to develop affordable social and worker housing in urban areas near industrial parks and export processing zones.

The State encourages economic components to develop affordable housing to provide conditions for everyone to have a place to live under market mechanisms.

By 2030, the total number of completed local dwellings will reach about 1,062,200. Of these, about 428,000 will be completed by 2025 and 634,200 by 2030. — VNS