Market rescue plan remains unclear

State Bank governor Nguyen Van Binh said commercial banks could earmark VND20,000-40,000 billion ($960 million-$1.9 billion) for property lending.

Nguyen Quoc Khanh, general director of DTJ Investment and Distribution Company, said the first the process first requires a full accounting of unsold housing units, especially those which were completed already.

A second category would include units still under construction. Khanh said that different approaches would be applied to different groups, with a higher priority placed on projects which were completed or nearly complete.

Less funding would be applied to projects in an early stage of counters.  Projects which were just broken ground should considered to halt for a while to wait for the market to be warmer, Khanh said.

Khanh also said that the current measures are focusing much on helping lower income people buy house, although the numbers of these potential buyers may not be large. “We should expand the subjects which can be eligible for getting loans to buy commercial housing,” Khanh said.

Meanwhile, Doan Chi Thanh, general director of Hoang Anh Sai Gon Real Estate Company, said that those measures must help customers have more confidence in the real estate market.
“We are facing the reality that customers seem not to believe in the real estate market any more, so then they have not poured in money,” Thanh said.

He explained that during recent times very few customers buy his company’s accommodation.
“The reason is that customers want to wait for more prices reducing,” he said.

Pham Trung Ha, general director of Hoa Phat Land, expected that the housing prices in 2013 would continue to drop, even with the government’s rescue plan.

The government has been actively implementing different measures and plans to support the market since the end of 2011, with a range of results.

Most recently, the  Ministry of Finance has planned to extend land-use and leasing taxes for developers, as well as the reducing of other taxes such as corporate income tax and VAT.

Going along with that, relevant ministries will improve the transparency in the real estate market activities, implement comprehensive and overall measures to remove the bottlenecks towards a healthy and sustainable real estate market.

According to the Ministry of Construction, at present, Hanoi has about 5,800 apartments unsold and an area of 175,000 square meters of office for rent vacant, while the inventory figures in Ho Chi Minh City are 15,000 apartments and 60,000 square meters respectively.

However, according to many experts, a number of government measures seem to be “administrative orders” that are very difficult to implement in reality.