Facing difficulties in dealing with houses for low-income earners in big cities in Vietnam, the Government and the Ministry of Construction (MOC) recently suggested houses for low-income earners can only be priced at VND2-4 million per sq.m. Therefore, one needs to have only several hundred million VND to be able to afford an apartment. News immediately spread throughout the market that it is totally possible to own a "super cheap" apartment.
In order to realise the dream of low-income people to own a house, Hanoi recently started building 1,500 apartments for low-income people at the new metropolis in Dang Xa 2. The expected invested capital for the project is VND700 billion. According to Viglacera Corporation, a major investor of the project, there will be cheap apartments on sale from VND300 million per unit. This information makes many people happy because low-income people will very soon be able to own their own houses. If the price is so cheap, the poor living in the cities will no longer have to worry about sky-high prices.
While the real estate market is in the half-light condition, this information does not surprise many people because this is not the first time investors advertise their "super cheap" apartments. In late 2011, two companies in Binh Duong and Hanoi claimed to put on sale a housing project with the "super cheap" price from VND130-150 million per 30sq.m unit.
According to experts' evaluation, this above-mentioned price level is plausible if the price of raw materials is cheap and investors utilise modern technology such as pre-stressed concrete, which could reduce the amount of raw materials up to 40 percent and the total price by 35 percent.
But reality has shown that there have not been any investors who are committed to the price level as promised. Many people believe that investors are just trying to polish their images. VND5 million per sq.m can only cover the construction cost, which means that this idea is only practical if the Government provides the land for free!
Besides, many people who intend to buy super cheap apartments are still concerned that with this price level, will they be assured of the quality of their apartments? Moreover, people also hypothesize: Is it true that real estate investors, when their pockets are already full after benefiting from artificially inflated prices, when the market freezes and the price returns to its true value, do they try to clear out their unsold apartments, release "super cheap" apartments to the market and use price and profit reduction tricks and even hugely benefit when there are new favourable policies from the Government?
Although this information is only for reference, at least it has to closely follow reality in order to create mutual trust with people. This has gradually become less and less real when investors' commitment does not match the apartments' price in reality. Last year many poor people rejoiced in vain when the VND130-150 million apartments were expected to enter the market. At the moment some rich investors committed to release VND300 million apartments. Despite the differences in their prices, these apartments remain unaffordable to the poor. The fundamental issue is that investors must keep their promises. If they do not follow through with what they promise, houses for the low-income will forever remain only a dream for the poor.
Luong Tuan
Vietnamese
