Tougher Approach to Tackling Abandoned Mansions

To minimize negative influences caused by abandoned mansions, Prime Minister has sent out a document demanding Ba Dinh Investment Corporation to buy 23 abandoned mansions in An Sinh condos, My Dinh II. This is regarded as the strongest experimental solution to alleviate increasing abandoned mansion in the capital.

 

For years, the pubic have been so furious about a variety of mansions being abandoned whereas millions of households lacking houses can’t find any. Addressing this issue, Prime Minister has demanded Hanoi People’s Committee to review and tackle hundreds of abandoned mansions for years without using. Observing Prime Minister’s demand, Hanoi People’s Committee has ordered Ba Dinh Investment Corporation in Quarter II to ask the owners of 23 abandoned mansions in An Sinh Condos, My Dinh II (Tu Liem) to quickly complete the building otherwise to buy those mansions at selling price plus bank interest since moment when signing contract with investors to sell to customers with real demand of housing.

 

According to Mr Nguyen Quoc Tuan – Deputy Director of Hanoi Department of Construction, this is a pilot area to deal with mansions being abandoned; therefore we will act strictly in time and procedures. Currently, most abandoned mansions have been transferred through many investors; Ba Dinh Investment Corporation has to review and order the owners to complete the buildings in given time”.

 

If the mansion has not been completed in given time, the corporation will buy it. As for ones in progress, investors have to seriously complete external design, the interior will be complete by the owners.

 

Most abandoned mansions belong to condos formed over 10 years ago. At that time, construction rate allowed by the government was 40-60 percent, which meant 40 percent of square was for mansion construction and the rest 60 percent was for condos construction. This method helped most investors at that time in capital burden when they built mansions, which were sold at price of billions and reinvested into condos construction.

 

Meanwhile, people often have a habit of buying land subdivision to build by themselves or buy mansions partly completed, which causes partly completed mansions buying and selling to spread widely. Completed mansions are difficult to sell while since most mansion purchasers are speculators, so far, these mansions have been transferred through many people and still uncompleted.

 

Demanding investors to be responsible for currently abandoned mansions also challenges investors as in fact, investors selling products to customers seems to put an end to their reliability of that land. Construction completion now belongs to the owners’ responsibility and there is no tie between investors and owners. Therefore, legally, it is hard for project investors to intervene.

 

Even in some cases, there’s a term in the contract signed between investors and house buyers that customers have to complete the house as in approved design, there are a lot of mansions abandoned. Local authority even cannot intervene. According to President of Co Nhue Commune People’s Committee, new city Co Nhue- Xuan Dinh has up to 21,000 meter square for mansion construction and these one are still in incomplete status. Local authority as well as investor Hanoi Housing Trade and Service Company has demanded customers to complete their mansions for times but there hasn’t been any change.

 

According to Mr Pham Gia Yen, Chief Inspector of Minister of Construction, since there hasn’t been rule of assigning time for house owners after handing over in Housing Law, there is also no punishment sanction in Decree 23. Without sanction, inspectors have no tools to comply.

According to a representative from Department of Housing and Realty market Management (Ministry of Construction), the department has assigned some missions to review status of abandoned in Hanoi, focusing mainly in cities with many abandoned mansions. Once there are the results and report from Hanoi People’s Committee, Ministry of Construction will make a report to submit Prime Minister to work out solutions.