Central bank starts huge credit package for social housing projects

April 04, 2023 | 14:58

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Developers of social housing projects buyers of this kind of houses are entitled to benefit from a credit package worth 120 trillion VND (5.1 billion USD) which was started by the State Bank of Vietnam (SBV) earlier this month.

Central bank starts huge credit package for social housing projects | Business | Vietnam+ (VietnamPlus)

Illustrative image. (Photo: VNA)

Hanoi – Developers of social housing projects buyers of this kind of houses are entitled to benefit from a credit package worth 120 trillion VND (5.1 billion USD) which was started by the State Bank of Vietnam (SBV) earlier this month.

Under the package, the loan interest rates for them will be 1.5-2% lower than those of commercial banks.

In line with a resolution dated March 11, 2023, the government has assigned the SBV to implement the credit package which aims to promote the development of the country's real estate market.

Borrowers must meet certain conditions prescribed by law and loan conditions of commercial banks. Each borrower will be allowed to borrow once from the package which will end when all the fund is disbursed, but no later than December 31, 2030.

The grace period is 3 years for project developers and 5 years for home buyers. The loan interest rate is 8.7 per cent and 8.2 per cent a year for developers and buyers, respectively, from April 1 until the end of June this year.

From July 1, the SBV will announce the loan interest rates for commercial banks participating in the programme every six months during the period.

Vietnam has set a target of constructing at least 1 million units of affordable "social housing" for low-income earners by 2030. Of these, 428,000 units will be built by 2025.

The country has so far completed 301 social housing projects in urban areas and industrial parks with a total of 155,800 apartments, while 401 others with 454,360 housing units are under construction.

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The lack of affordable social housing has raised whether foreign developers should be allowed to invest in this segment in Vietnam.

PM orders close coordination to remove obstables to property market

Prime Minister Pham Minh Chinh has just signed a document requesting more efforts to promote the development of and remove obstacles to the real estate market.

MoC makes suggestions on social housing

The Ministry of Construction has suggested removing a condition which states that those who want to move into social housing must have registered for permanent or temporary residence for one year or longer in the relevant area.

By VNA

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