Collaborative Efforts to Clear Bottlenecks for Real Estate Development

The Government Office recently convened an online conference of the Prime Minister’s Working Group. The primary objective of this meeting was to critically evaluate, expedite and provide comprehensive guidance for the resolution of impediments impacting real estate projects across various localities and businesses. This initiative was undertaken in response to the enactment of new laws: the Land Law, Housing Law, and Real Estate Business Law.

The meeting was presided over by Deputy Prime Minister Tran Hong Ha. It was attended by the Minister of Construction and members of the Prime Minister’s Working Group. Additionally, leaders from various governmental departments were present, including the Ministry of Public Security, the Ministry of Justice, the Ministry of Finance, the Ministry of Natural Resources and Environment, the Ministry of Planning and Investment, the Ministry of Information and Communications, the State Bank of Vietnam, and the Government Inspectorate.

The Prime Minister's Working Group reported its tasks done in 2023. Accordingly, the Ministry of Construction issued 37 documents to instruct and answer difficult issues regarding planning, social housing, old housing renovation, construction licensing and project transfer for localities (like Hanoi, Ho Chi Minh City and Dong Nai).

In an effort to intensify the execution of the “1-million social apartment project” aimed at low-income earners and industrial park workers, the Ministry of Construction issued two official documents. The first, Official Document 1608/BXD-QLN dated April 24, 2023, and the second, Official Document 1551/BXD-QLN dated April 20, 2023 were directed to the People’s Committees of centrally-administered provinces and cities. Furthermore, the Ministry organized two national online conferences on May 19, 2023, and February 22, 2024, to ensure effective communication and coordination of efforts.

The Ministry of Finance, the Ministry of Natural Resources and Environment, the Ministry of Planning and Investment and the State Bank of Vietnam also promulgated many official documents to direct, urge and guide localities to implement tasks and address problems within their authority.

Localities established working groups or steering committees to tackle difficulties faced by real estate projects. They managed to resolve obstacles for some real estate projects.

The Working Group and the Ministry of Construction have actively coordinated with the Government Office and relevant ministries and agencies to present many reports and recommendations at the Working Group meetings chaired by the Prime Minister and the Deputy Prime Ministers and propose the Government, the Prime Minister and the Deputy Prime Ministers to issue resolutions, official dispatches and conclusion notices to deal with obstacles in the real estate market in the near future.

Regarding tasks and solutions in the coming time, the Working Group will continue to focus on implementing and completing the tasks and solutions assigned by the Prime Minister in Decision 1435/QD-TTg on reviewing, urging and instructing activities to deal with obstacles in real estate projects for localities and businesses.

Ministries, central agencies and localities will continue to actively implement Resolution 33/NQ-CP of the Government, directives and announcements of the Prime Minister and Deputy Prime Ministers on solutions to tackle difficulties and promote the safe, strong and sustainable development of the real estate market.

The Ministry of Construction will focus on urgently building and completing draft documents detailing and guiding the implementation of the Housing Law and Real Estate Business Law and submit them to the Government in May 2024.

The ministry will bolster activities of the Working Group, promptly guide and remove legal obstacles; urge localities to deal with impediments in real estate projects reviewed by the Working Group and will have written instructions by June 30, 2024.

The agency will coordinate with relevant ministries, agencies, localities and businesses to boost social housing development; effectively implement the 1-million social apartment construction project for low-income earners and industrial park workers in the 2021-2030 period and effectively carry out the VND120 trillion credit program.

The ministry will instruct localities to review, prepare and adjust general planning, zoning planning and detailed construction planning to serve as a basis for implementing local real estate projects; and inspect the handling of administrative procedures relating to real estate projects.

The Ministry of Natural Resources and Environment will focus on urgently compiling and completing draft documents detailing and guiding land laws and submit them to the Government in May 2024.

The ministry will urge, guide and support officials working directly with localities, especially in big cities such as Hanoi, Ho Chi Minh City and Da Nang, to address problems concerning land allocation, land lease, land pricing and annual land-use planning.

It will inspect the settlement of land pricing procedures for real estate projects and promptly detect and resolutely handle lengthy cases.

The Ministry of Planning and Investment will continue to direct and guide localities to remove obstacles in investment licensing procedures and investor selection procedures for real estate projects, commercial housing projects, social housing projects and worker housing projects.

The Ministry of Finance will continue to implement official dispatches and directives of the Prime Minister; keep a close watch on developments in the stock market and the bond market; promptly propose solutions to develop the stock market and the corporate bond market safely, healthily and sustainably.

The ministry will regularly monitor and assess bond offerings and transactions of real estate businesses in domestic and international markets to come up with the most suitable solutions and plans. It will research, propose and implement solutions on restructuring corporate bond debts relating to real estate projects.

The State Bank of Vietnam will continue to implement official documents and directives of the Prime Minister, closely monitor real estate credit developments to have workable solutions to remove difficulties and boost credit lending for real estate businesses.

The SBV will direct, urge and guide commercial banks to create more favorable conditions for businesses, real estate projects and home buyers to access credit capital. In particular, the central bank will research, propose and implement solutions on credit debt restructuring relating to real estate projects invested by enterprises.

The SBV will continue to effectively deploy the VND120 trillion credit program to provide preferential loans for social housing, worker housing and old apartment reconstruction. The central bank will continue to research and adjust the support mechanism for refinancing programs.

Localities will establish working groups to review and research to remove hindrances for local real estate projects; completely resolve difficulties for real estate projects reviewed by the Prime Minister's Working Group and have instructions before June 30, 2024.

Localities will actively meet and directly work with each business, each project, especially large ones, to learn about their difficulties to have the best solutions relating to land, investment, planning and housing procedures within their jurisdiction.

They will need to summarize problems beyond authority and send them to the Prime Minister's Working Group as well as to the Prime Minister for direction, consideration and resolution.

They will need to have specific mechanisms and solutions to streamline administrative procedures for project formulation and licensing, land allocation, land lease, site clearance and construction investment to support and encourage investors and enterprises to deploy their investment projects to boost the supply for the market and utilize preferential capital for social housing development.

Localities will need to enhance the responsibility of agency leaders to quickly handle legal procedures and solve difficulties for local real estate projects.

Businesses will actively review legal procedures and clearly state difficulties in each project to request competent agencies for consideration and resolution.

They should restructure their project and product portfolios according to their capabilities and actual market conditions.

Companies should proactively review and restructure capital sources, especially credit sources, to focus on carrying out and completing their projects, one by one, to avoid scattered and unfinished investments, while ensuring repayment plan for credit loans and corporate bonds.

They should revise their real estate segments and prices to boost sales and liquidity to create capital flows to maintain operations and implement projects.

Source: Vietnam Business Forum