Social housing ready to come onstream

Scores of low income earners are desperate for new housing

Thousands of social residential units will come online this year and private realty companies are taking aim at these segments.

Hanoi’s Construction Department and relevant authorities last week announced that there would be 3,500 units from five social housing developments in the city launched soon.

Vinaconex Xuan Mai will sell 860 units in the second launch of its 1,512 unit development in Hanoi’s Ha Dong district, Handico 5 and Handico 3 with 868 units in Sai Dong new urban area,Viglacera with about 1,000 units in Dang Xa new urban area in Gia Lam district and 124 units in Tu Liem district.

Vincon is offering 805 social housing units in Danang’s Hai Chau district.

Saigon Real Estate Corporation’s MTV limited company started launching 84 units of An Suong 2 apartment building located at District 12’s Tan Hung Thuan ward for low-income earners in Ho Chi Minh City.

According to Ministry of Construction (MoC) statistics, there were 37 projects providing 64,000 units under construction last year.

The future social housing supply will increase, with more registrations to invest into the segment not only from state-own realty companies such HUD, Vinaconex and Viglacera, but also private realty companies.

Recently, Hanoi People’s Committee issued a licence to Capital Investment and Commercial Company to develop a 1.8 hectare low-end apartment in Tu Liem district’s Xuan Dinh ward and Thai Binh Company to develop a 9,600-square-metre site in Hoang Mai district.

Deputy MoC minister Nguyen Tran Nam said: “The number of private companies developing social houses currently is still very small, but I believe the number will increase in the future.”

Nam said difficulties in developing social residential developments such as a lack of investment capital and cleared land were gradually being solved and more incentives would be provided to developers.

Dang Hoang Huy, chairman of Vinconex Xuan Mai, said: “Getting 10 per cent of profits in constructing and selling social residential units in any case are an attractive incentive in the eyes of many private developers. However, regulations issued by local authorities to choose buyers for the projects put much pressure on us.”

Huy said in the first launch of the 1,512 unit project in Ha Dong district the company had offered only 314 units. However, they received more than 1,000 registrations to purchase. In the project’s second launch next month, Vinaconex Xuan Mai planned to offer 860 units.

With the Hanoi Construction Department’s new regulations to allow low-income earners from other areas to purchase social houses in Hanoi, the number of registrations will 10 times than the number of offered units.

“Selecting customers for the units is not easy,” said Huy.

By 2015, the MoC targeted to satisfy accommodation for about 700,000 low-end earners.