ASEAN KEY DESTINATIONS
Ministry of Construction may increase size of social housing
The Ministry of Construction has proposed that the maximum area of social housing apartments be raised to 90 square metres (sq.m.) from the current 70sq.m.
The proposal is part of the draft decree on the development and management of social housing projects, which has evoked mixed opinions from experts about its reasonableness and impact on the development of such projects.
The ministry said increasing the maximum area of social housing apartments is aimed at meeting the demand for accommodation made by households with seven to eight members, who had found the 70sq.m. apartments too cramped.
Several real-estate companies also deemed the proposal reasonable.
Luu Minh Ngoc, general director of the Bac Son Group said the proposal, if approved, will provide a wider range of choice in terms of apparent areas for developers and offer a better fit for home-buyers' demand.
However, with its selling price of about VND12 million (US$560) per square metre, the price of an apartment with an area of 90sq.m. will be roughly VND1 billion ($47,150), which might prove to be unaffordable for low-income earners.
Nguyen Thu Huong, a desk worker in Ha Noi, who is looking to buy a social housing apartment said that a 90sq.m. apartment can meet accommodation demand for large families.
In addition, home buyers will also have more choices.
Pham Sy Liem, deputy president of the Viet Nam Federation of Civil Engineering Association, expressed his worry that the VND30 trillion ($1.42 billion) support package for low-income earners to buy houses will hardly meet demand and fewer people will benefit from the support package.
Experts also pointed out that real-estate companies might benefit from converting inventory apartments with a 90sq.m. area into social housing apartments.
According to the draft, the design standard for a social housing apartment is a minimum of 25sq.m. and a maximum of 90sq.m.
Buyers or lease-purchasers of social housing apartments will be allowed to sell, mortgage or lease the apartments only after paying off their loans and granting land use right certificates, the draft said. In addition, profit earned from a social housing project must be less than 10 per cent of the total investment cost.
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