HCM City’s housing industry faces difficulties

A housing project in Ho Chi Minh City (Photo: VNA)

HCM City - The property industry in Ho Chi Minh City, and in fact the country in general, faces several problems that need urgent solutions, especially with regard to legal provisions.

Nguyen Thi Thanh Huong, general director of Dai Phuc Land, said it took her company 15 years to complete procedures for one of its projects.

The long delays often meant by the time a project was underway the design became outdated, she said.

But if the company made adjustments to meet market requirements, it would have to apply from the beginning again, she lamented.

Tran Quoc Dung, Deputy General Director of Hung Thinh Group, said it took at least one year for a project to complete basic procedures and begin sales, but in most cases it was more like four or five years.

The final step of issuing red books – the title deeds -- to buyers also faced difficulties, he said.

Le Hoang Chau, Chairman of the HCM City Real Estate Association, said there had been a remarkable decline in the supply of new housing projects in HCM City in recent years.

It was down 20 percent in 2018 and 70 percent last year. In 2019 only one project managed to complete legal procedures and begin sales.

Conflict and overlapping legal provisions were mainly to blame for the decline, Chau said.

"The current licensing process involves four steps, which take a lot of time," he added.

Nguyen Trong Ninh, director of the Ministry of Construction’s housing and real estate market management department, admitted these regulations were not consistent because they were found in multiple laws.

He said HCM City should therefore draft solutions for the difficulties faced by developers, and his ministry and others would give their opinions on them.

Asked about the procedures for issuing land use right certificates, he said in general people must be granted the certificate immediately after the deal is completed.

The Ministry of Natural Resources and Environment is responsible for the issuance of red books and handles them based on each case, according to Ninh.

The Law on Investment prescribes the procedures for adjusting a project and which ones are handled by the Department of Planning and Investment and which ones by others.

The law also stipulates that the Department of Construction is the authorised agency to handle issues related to construction procedures and apartment planning and adjustment.

He admitted that supply had decreased this year due to not just to the COVID-19 pandemic but also to the overlapping and inconsistent laws.

The Government had this year provided many solutions to help revive the market and resolve the difficulties faced by the industry, he added.