Voters have expressed concerns that the cost of social housing remains too high for the majority of low-income workers, making homeownership difficult.

The Ministry of Construction recently addressed a petition from voters in An Giang Province, submitted to the National Assembly through the People's Petition Committee. The petition highlighted issues related to social housing accessibility.

According to voters, the development of social housing for low-income individuals is a significant and humanitarian policy of the Party and the State. However, current social housing prices remain unaffordable for most workers, especially those with low incomes, limiting their ability to purchase homes.

Additionally, access to loans for purchasing social housing remains difficult. The percentage of loans provided by banks and financial institutions is low, and borrowing from the Vietnam Bank for Social Policies is challenging due to irregular funding and complex procedures.

Buyers are often required to contribute an initial payment of at least 30%, and commercial bank loan interest rates remain high, increasing the financial burden on households.

Voters have repeatedly called for more effective and comprehensive solutions to address the ongoing challenges in the social housing sector.

Determining social housing prices

In response, the Ministry of Construction explained that the 2023 Housing Law establishes clear guidelines for determining social housing prices.

The selling price must include all necessary costs to recover investment capital, such as land compensation, site clearance, resettlement support, infrastructure development costs, loan interest, and other reasonable expenses incurred by developers. However, government incentives are not factored into the final price.

For rent-to-own housing, the price is calculated similarly but does not include maintenance costs, which are paid separately by tenants. Rental prices are determined through agreements between developers and tenants.

If a developer secures a project through a bidding process, the agreed-upon price does not require additional approval.

Incentives for social housing developers

The Ministry also emphasized that Article 85 of the 2023 Housing Law outlines several incentives for social housing developers. These include exemptions from land use and rental fees, tax incentives, and a guaranteed profit margin of 10%.

Developers are also allocated land or commercial space, which is not factored into social housing costs.

“These policies aim to encourage investment in social housing while ensuring prices remain affordable for low-income workers,” the ministry stated.

Expanding financial support for social housing

Regarding financial support, the Ministry of Construction noted that the government has been directing ministries and agencies to develop funding solutions to boost social housing development.

For example, under Resolution No. 33 of 2023, the government allocated a credit package of 120 trillion VND ($4.8 billion) for commercial banks to provide social housing loans, alongside budget allocations for the Vietnam Bank for Social Policies.

As of now, only 37 out of 63 provincial governments have submitted or published project lists for participation in this program, covering 90 projects.

Loan disbursements have reached 2.36 trillion VND ($94 million), with over 2.16 trillion VND ($86 million) going to developers of 17 projects and 198 billion VND ($7.9 million) to homebuyers in 15 projects.

In October 2024, the Office of the Government issued a directive following a review of the implementation of Directive No. 40, which focuses on strengthening the Party’s leadership in social policy credit programs.

As part of this effort, the Prime Minister assigned the Ministry of Construction, in collaboration with the Ministry of Planning and Investment, the Ministry of Finance, and the State Bank of Vietnam, to finalize a new 30 trillion VND ($1.2 billion) preferential credit package by the end of October 2024.

This package would support home purchases, rent-to-own schemes, and home renovations for social policy beneficiaries. The funding would be split evenly between government bond issuances and local budget allocations.

The Ministry of Construction later reported to the Prime Minister on the progress of this initiative by the end of 2024.

The goal of one million social housing units

Under the national plan to develop at least one million social housing units for low-income workers and industrial zone employees between 2021 and 2030, the Ministry of Construction acknowledged both achievements and challenges.

While progress has been made, implementation in the 2021–2025 phase has fallen short of expectations. As of December 2024, new construction starts have reached only about 40% of the phase’s target.

Moving forward, the ministry has pledged to work closely with relevant agencies and local governments to accelerate social housing development and implement targeted solutions.

Hong Khanh