Vietnam's contruction minister said on October 31 that the real estate industry should focus on low-cost housing to dig its way out of its Vietnam's property market hole, Vietnamet reported on the same day.
"Tackling difficulties in property market by heading towards the poor and low-paid people will reach many targets," Minister Trinh Dinh Dung said.
He said that the supply of real estate products outweighs demand but most of them are high and mid-end properties while there is lack of inexpensive housing that most people can afford.
Dung suggested investors to increase the number of so-called "social housing" projects for the poor, soldiers and workers, and that the central bank extend credit room for investors, homebuyers, especially social housing investors and buyers.
He asked the National Assembly to offer tax cuts or reduction to households that buy social housing for the first time and the "best deal" on corporate income tax incentives to social housing investors.
Dung warned that difficulties facing the real estate industry would affect many sectors including construction, building materials, electrical devices, steel, banking, and the macroeconomy as a whole, according to the Vietnamnet report.
As of August 31, total property loans in Vietnam were estimated at VND203 trillion (US$9.74 billion), with non-performing loans accounting for 6.6 percent of the total, Dung said, citing the State Bank of Vietnam statistics.
Business loans related to property sector loans for property trading; loans for investment, manufacturing and trading; and loans secured by property was over VND1,000 trillion, equal to 57 percent of total loan in the country.
Experts estimated that some 70,000 housing units in Ho Chi Minh City and Hanoi remain unsold, VnEconomy reported in late September.
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