At the National Assembly's Supervisory Forum on socio-economic development, Dr. Tran Du Lich, a member of the National Financial and Monetary Policy Advisory Council, shared his concerns about Vietnam's real estate market.

He observed that the current market lacks housing for middle- and low-income earners. "The products on the market are like an airplane with only business and first-class seats, but no economy class. This is a major shortcoming," Lich said.

The expert also expressed concern about the rapid increase in land prices, exceeding the affordability of most citizens. He attributed this to land speculation and the conversion of agricultural land for auctions and project bidding, which inflate the land price "bubble." According to Lich, this issue has "exceeded the tolerance of the economy and the people," creating significant challenges for state-led development management.

Dr. Tran Du Lich, member of the National Financial and Monetary Policy Advisory Council. Photo: National Assembly Portal

Dr. Tran Du Lich, member of the National Financial and Monetary Policy Advisory Council. Photo: National Assembly Portal

Therefore, he recommended that the National Assembly and its delegations strengthen their supervision of the real estate sector, including social and commercial housing. He suggested that this supervision should begin with the urbanization process, the conversion of agricultural land to residential land, planning, and the implementation of commercial housing projects. This process needs to be tightened to avoid situations where hundreds of houses are built but remain unoccupied, leading to waste while citizens cannot afford to buy homes.

Le Hoang Chau, Chairman of the Ho Chi Minh City Real Estate Association (HoREA), cited government data indicating 2,981 stalled projects nationwide requiring resolution, with a total value of 7-7.5 quadrillion VND and involving tens of thousands of hectares of land. "The biggest waste of land lies here, with responsibility shared by the state and businesses, not just the legal framework," he stated.

He expressed his agreement with the National Assembly's resolution to address bottlenecks for numerous projects in Da Nang, Khanh Hoa, and Ho Chi Minh City. However, he suggested that the policies in this resolution should be implemented in other localities to unlock stagnant land resources. He also believed that the government should add new policies when researching and proposing amendments to the Land Law to address legal loopholes.

Mr. Le Hoang Chau, Chairman of the Ho Chi Minh City Real Estate Association. Photo: National Assembly Portal

Mr. Le Hoang Chau, Chairman of the Ho Chi Minh City Real Estate Association. Photo: National Assembly Portal

Regarding the real estate market, the HoREA Chairman agreed on the lack of affordable and low-cost housing supply. He attributed this mainly to institutional obstacles that make social housing projects unattractive to businesses and investors.

He proposed that the government promote social housing rentals. Concurrently, the state should adjust the product structure of the real estate market, increase the number of affordable commercial apartments, and support buyers with access to long-term credit at reasonable and stable interest rates over the long term.

"These commercial housing projects do not need tax and credit incentives like social housing, but a price mechanism is needed for people to access them," Chau said.

In their presentation, the Standing Committee of the Economic and Financial Committee also pointed out that the legal documents related to the real estate market are overlapping and inconsistent. Guidance documents are not of high quality and do not fully anticipate practical issues. Some regulations are impractical, slow to be reviewed, amended, and supplemented, unclear, lacking regulatory provisions, or guidance.

Project investment procedures are complex, lengthy, and lack interconnectivity, consistency, and synchronization. Accessing land for new real estate projects is difficult. The acquisition of land use rights and the conversion of land use purposes for commercial housing projects face obstacles due to changes in legal regulations over time, leading to varying interpretations in different areas.

Delays in land valuation are occurring in many localities, a major obstacle leading to project stagnation. Many projects have not been able to complete investment and construction procedures because they are waiting for state management agencies to review legal aspects and determine land prices.

From 2015 to 2021, the real estate market experienced dynamic growth, but the product structure was unreasonable and imbalanced in terms of supply and demand, primarily focused on the high-end segment and financial investment, lacking housing products suitable for the affordability of the majority of the population.

From 2022 to 2023, the market declined; supply decreased significantly compared to the previous period; real estate prices increased many times higher than the average income increase of most people; a large number of residential real estate projects encountered obstacles, slow progress, delayed implementation, and stagnation, causing waste of land and capital, increasing costs for investors, and raising selling prices.

The Standing Committee proposed that the government implement solutions to decisively remove obstacles for real estate projects and social housing projects nationwide; enhance decentralization, administrative procedure reform, and improve control measures.

The government needs to establish tools to control the power of agencies and authorized individuals in real estate market management; rationally utilize measures to regulate and orient the market, and implement solutions to facilitate easier access to housing supply and credit for citizens.

Son Ha