Experience from Localities as the “Bright Spot” in Social Housing Development

After receiving strong directions from the Prime Minister and the involvement of the Prime Minister’s Task Force in resolving difficulties for real estate projects, many localities have “changed their perspectives, changed their ways” to quickly “get involved,” attract investment, and stimulate businesses to initiate a series of large-scale social housing projects.

Some leading localities in social housing development, as evaluated by the Ministry of Construction, include Binh Duong, Bac Ninh, Hai Phong, and Dong Nai.

Determined Deployment of Integrated Solutions for Social Housing Development

From being a locality that lagged behind in social housing development in previous years, Hai Phong city has now become one of the leading localities in the country in implementing the construction of social housing, achieving set targets.

According to the Chairman of Hai Phong People’s Committee, Nguyen Van Tung, the city has a population of over 2 million people, with a significant portion of low-income residents, leading to a high demand for social housing in the area.

In the inner city area, there are many old deteriorated apartment buildings, cramped core areas, and industrial zones attracting approximately 500,000 workers (mostly from neighboring provinces). Therefore, the city pays special attention to the issue of social housing.

Hai Phong has issued a resolution on social housing development in the city until 2030, focusing on the construction of 33,500 social housing units. The city has also been assigned by the Prime Minister to build over 14,000 social housing units in the 2021-2025 period.

To achieve the set goals, the city’s leaders have made efforts to change the mindset of many people who viewed social housing as “spaces for vulnerable, low-income groups” to a broader goal. That is to build genuinely new, integrated, convenient social housing with a complete social infrastructure system, such as hospitals, schools, and most importantly, affordable and suitable for the majority of residents.

Currently, Hai Phong has completed six projects with approximately 4,068 completed apartments. The Happy Home project, with a scale of 4,300 apartments, has commenced construction in the early days of the new year 2024.

In addition, the city has also selected investors for nine projects with a total of 8,890 units. Six other projects with a total of 15,377 units have also received investment approval, and the city is currently selecting investors for early implementation.

Hai Phong’s leadership emphasized that by 2025, the city will basically complete the target of 15,400 social housing units in the 2021-2025 period set by the Government.

Bac Ninh province is expected to become a high-tech industrial center in the region and the world by 2050. According to Vice Chairman of Bac Ninh People’s Committee, Dao Quang Khai, the province has implemented 54 projects for low-income groups and housing for workers in industrial zones.

It is estimated that when completed, these projects will provide approximately 7.1 million square meters with over 77,000 apartments for about 231,000 people.

In the 2021-2025 period, Bac Ninh plans to develop 30,671 apartments and 41,514 apartments in the 2026-2030 period.

After the project was approved, Bac Ninh has directed the implementation of specific solutions, such as conducting zoning reviews to supplement and identify land funds for social housing investment, compiling a list to attract investment, assigning the Department of Construction to build specific policy mechanisms to attract investment in social housing construction, especially housing for workers and laborers in industrial zones.

Through zoning reviews, approximately 172 hectares of land have been allocated for social housing construction to meet the planned social housing development targets assigned in Decision 338/QD-TTg dated April 3, 2023, for the 2021-2025 period.

Regarding the implementation results of the VND 120 trillion support package, the Bac Ninh People’s Committee has directed the Department of Construction to aggregate the loan demands of investors, review each specific case, and guide investors in completing the necessary documents to meet the loan conditions as prescribed.

Currently, Bac Ninh has six projects with a total investment amount of over VND 14.5 trillion, with an expected loan amount of about VND 3.38 trillion.

Mobilizing Resources and Providing Additional Incentives

In the southern provinces, Binh Duong is a province that has developed many industrial zones and attracted a large labor force to work and live there. This locality has been evaluated by the Ministry of Construction as a “bright spot” leading in social housing development in urban areas and housing for workers nationwide.

According to representatives of the Binh Duong Department of Construction, in recent years, the province has mobilized resources to address housing issues, especially social housing, ensuring sustainable development throughout the development process. This includes the role and responsibility of investors and businesses in solving housing issues for workers.

Specifically, in the 2011-2015 period, Binh Duong attracted 82 social housing projects. According to the draft plan for social housing and workers’ housing development in the 2021-2025 period, with a vision to 2030, Binh Duong plans to invest in approximately 172,879 social housing units, accommodating around 678,307 residents.

According to the assessment of Minister of Construction Nguyen Thanh Nghi, with the strong attention and guidance from the Government, the Prime Minister, and the involvement of ministries, departments, and localities, social housing development has achieved significant results.

Among the localities performing well, Binh Duong stands out as a leading “bright spot” in social housing development in urban areas and housing for workers.

However, the leadership of the Ministry of Construction pointed out that although some localities have a significant demand for social housing, the investment in construction is still limited compared to the targets of the project. In fact, some localities have not started any social housing projects from 2021 until now.

Therefore, to achieve the goals of social housing development in 2024, the Ministry of Construction proposes that ministries, departments, and localities focus on resolving difficulties and obstacles in investment procedures, land use fees, planning, land funds allocation, and the development of accommodation for workers. They should also consider reducing interest rates for loans in the VND 120 trillion support package, allocate land funds for social housing and workers’ housing at suitable locations, and more.

Meanwhile, Chairman of the Ho Chi Minh City Real Estate Association, Le Hoang Chau, suggests that in terms of land funds for social housing development, localities need to implement an auction to select investors to carry out projects utilizing public land in accordance with the provisions of the 2023 Bidding Law. This will facilitate the selection of capable investors and efficient utilization of the public land fund.

Chau also proposes the supplementation or increase of incentives for developers of social housing projects to encourage and attract more investors to participate in the implementation of projects. These incentives could include profit-level incentives, preferential loans, and tax benefits.