The disbursement of the 30-trillion VND (1.38 billion USD) housingstimulus package has been stagnant, despite the increase in the numberof successful transactions in the real estate market.
Economistsand estate businesses said the market had seen clear improvements. Thenumber of successful transactions in Hanoi in the first quarter of theyear rose by three times over the same period last year, reaching 4,250.Most of the transactions involved apartments with small and mediumareas of 70sq.m to 90sq.m.
Deputy Minister of Construction NguyenTran Nam said the estate market this year would see more transactionsin several segments such as land, apartments and offices. Apartments,especially, of less than 1 billion VND (46,300 USD) that are suitablefor low-income earners will sell well.
Experts saidit was time for the package to support the market and reduce thehousing inventory. However, the package cannot be disbursed fully byJune 1, 2016 as the Government's set target.
TheVietnam Real Estate Association said the disbursement was slow forsocial and cheap commercial housing projects, despite an increasingnumber of transactions and reducing inventory.
About 6.2 trillion VND (287 million USD) or 20 percent of the package has been disbursed so far.
Chairman of the Ho Chi Minh City Real Estate Association Le Hoang Chausaid the disbursement was too low, though 15 banks were contributing tothe package.
Chau said regulations stipulated thatthe total income of eligible low-income earners should be less than 9million VND (416.7 USD) a month.
However, severalcommercial banks did not accept the regulation as they believed that theincome would not be enough to repay debts.
NguyenThe Hien from Bac Ninh province is eligible to get a loan from thepackage. However, several banks rejected his application because theyfelt he would not be able to repay the loan with his low income.
"I have to consider taking a commercial loan that has a higherinterest rate and financial risks. I have paid 30 percent of the amountfor my apartment. If I'm unable to get a loan, I'll have to sell theapartment," Hien said.
He suggested the loanduration should be extended from the current 10 to15 years to 20 to 25years to reduce the pressure on low-income earners.
Abank representative said the recent regulation promulgated by theconstruction ministry in March caused the package disbursement tostagnate. Such low incomes would not be able to cover the debt afterdeducting the daily expenditure.
"The loan comesfrom people's deposits in banks. That is the reason why banks have beencareful in giving loans to avoid bad debts in the future," he said.
Nguyen Hoang Minh, Deputy Director of the State Bank ofVietnam's branch in HCM City, said they had sent documents to 15commercial banks to collect ideas that would then be submitted to thecentral bank for consideration.-VNA
Economistsand estate businesses said the market had seen clear improvements. Thenumber of successful transactions in Hanoi in the first quarter of theyear rose by three times over the same period last year, reaching 4,250.Most of the transactions involved apartments with small and mediumareas of 70sq.m to 90sq.m.
Deputy Minister of Construction NguyenTran Nam said the estate market this year would see more transactionsin several segments such as land, apartments and offices. Apartments,especially, of less than 1 billion VND (46,300 USD) that are suitablefor low-income earners will sell well.
Experts saidit was time for the package to support the market and reduce thehousing inventory. However, the package cannot be disbursed fully byJune 1, 2016 as the Government's set target.
TheVietnam Real Estate Association said the disbursement was slow forsocial and cheap commercial housing projects, despite an increasingnumber of transactions and reducing inventory.
About 6.2 trillion VND (287 million USD) or 20 percent of the package has been disbursed so far.
Chairman of the Ho Chi Minh City Real Estate Association Le Hoang Chausaid the disbursement was too low, though 15 banks were contributing tothe package.
Chau said regulations stipulated thatthe total income of eligible low-income earners should be less than 9million VND (416.7 USD) a month.
However, severalcommercial banks did not accept the regulation as they believed that theincome would not be enough to repay debts.
NguyenThe Hien from Bac Ninh province is eligible to get a loan from thepackage. However, several banks rejected his application because theyfelt he would not be able to repay the loan with his low income.
"I have to consider taking a commercial loan that has a higherinterest rate and financial risks. I have paid 30 percent of the amountfor my apartment. If I'm unable to get a loan, I'll have to sell theapartment," Hien said.
He suggested the loanduration should be extended from the current 10 to15 years to 20 to 25years to reduce the pressure on low-income earners.
Abank representative said the recent regulation promulgated by theconstruction ministry in March caused the package disbursement tostagnate. Such low incomes would not be able to cover the debt afterdeducting the daily expenditure.
"The loan comesfrom people's deposits in banks. That is the reason why banks have beencareful in giving loans to avoid bad debts in the future," he said.
Nguyen Hoang Minh, Deputy Director of the State Bank ofVietnam's branch in HCM City, said they had sent documents to 15commercial banks to collect ideas that would then be submitted to thecentral bank for consideration.-VNA
