Hanoi (VNA) - The Government’s decision to allow businesses, rather than the state, to takꦬe the lead in social housing development is widely seen as a sound policy.

This strategy is reinforced by tax exemptions on land and low-interest loan policies, creating an attractive investment landscape. However, despite these measures, the persistent shortage of affordable housing, especially in urban centers, highlights the urgent need for enhanced policy mechanisms, financial support, and streamlined implementation to meet growing demand. At the recent seminar entitled “Real estate in 2025: seeking opportunities in challenges” held in Hanoi on February 11, Vuong Duy Dung, Deputy Director of the Housing and Real Estate Market Management Agency under the Ministry of Construction, emphasised the necessity of mobilising all available resources. He underscored the importance of contributions from both state and private sectors across various housing segments to address the real housing needs of the population. The 2023 Housing Law and its accompanying decrees have introduced clearer regulations regarding land allocation, investment procedures, pricing, and the identification of target groups for social housing. These policies are designed to provide a structured framework for investors while ensuring accessibility for lower-income residents. The government and relevant ministries have already begun implementing these initiatives, leading to incremental improvements in the real estate supply. Clear and transparent regulations have positively influenced investor confidence, facilitating the smoother rollout of social housing projects in several localities. This progress not only expands affordable housing options but also contributes to the stability and growth of the property market. Although the real estate market continues to face challenges, industry experts maintain that "opportunities exist within difficulties." With new policies taking effect, the sector is poised for renewed growth. The Ministry of Construction has established specific annual targets for social housing development in each locality, providing a roadmap for structured and measurable progress. These targets are expected to improve the disbursement of the 145 trillion VND (5.7 billion USD) social housing loan package, ensuring that funding reaches developers efficiently and helps accelerate project completion. Dung highlighted that social housing remains a pressing need for low-income earners, particularly those in major urban centers such as Hanoi and Ho Chi Minh City. He noted that increased participation from both public and private sectors is essential to meeting demand, as the gap between housing availability and affordability remains significant. Despite substantial state incentives, including tax exemptions and simplified legal procedures, the social housing sector has struggled to attract private investment at the desired scale. According to Le Van Binh, Deputy Director of the Land Department under the Ministry of Natural Resources and Environment, the challenges stem from various factors, including low profit margin, lengthy bureaucratic processes, and limited access to financing. While social housing projects are in high demand and theoretically profitable, they are rarely prioritised by developers, who often favour high-end projects with greater returns. Encouraging businesses to invest in social housing will require not only financial incentives but also improved administrative procedures to reduce project implementation times and costs.

Financial institutions play a crucial role in the success of social housing initiatives. Nguyen Quoc Hung, Vice Chairman and General Secretary of the Vietnam Banks Association, outlined the Government’s recent efforts to support real estate businesses, including extending bond repayment deadlines and allowing developers to restructure resources to meet financial obligations. However, he cautioned that challenges remain, particularly in ensuring that housing products reach genuine buyers rather than speculative investors. To achieve this, stricter regulations on eligibility and purchasing criteria may be necessary to prevent market inefficiencies and ensure that affordable housing serves its intended beneficiaries. Hung also expressed concerns over housing quality, pointing out that while property prices have doubled in recent years, quality improvements have not kept pace. Addressing this imbalance will be key to maintaining consumer confidence and ensuring long-term sustainability in the housing sector. The state’s decision to entrust social housing development to private businesses, supported by tax exemptions and low-interest loans, is seen as a viable long-term strategy. Hung reiterated that with well-defined government targets and committed local implementation, the goal of constructing 1 million social housing units by 2030 remains achievable. The banking sector is prepared to allocate significant resources, including preferential loan packages, to support developers in meeting this objective. However, streamlining administrative procedures, enhancing transparency, and ensuring efficient fund disbursement will be critical to accelerating progress./.