Real estate bailout package to support low-income earners
23-05-2013
Low-income people, state officials and soldiers will be able to borrow at preferential rates in order to buy homes smaller than 70 square metres and under VND15 million per square metre (USD720). In addition, investors of social housing can borrow from this package.
People who wish to access preferential loans to buy social housing will also be given support.
SBV stated that the interest rate will be kept at 6% throughout the year and into the first month of 2014, at which time the state bank will announce the new rates for the next year. SBV has asked banks to keep interest rates low for the next 10 years. After this period loans will be given dependent on individuals' financial capacity.
Nguyen Viet Manh, head of SBV's credit department said the main goal is to support low-income people and buyers of social housing, with hope that such support will also make impact on the real estate market.
However many people have expressed worries that the supply of affordable housing is already low, and that increased demand could lead to a serious shortage.
In response Nguyen Tran Nam, Deputy Minister of Construction, said that currently there are tens of thousands of affordable homes and that there are five to seven more affordable housing projects slated to break ground in May.
Possible speculation has also been the source of worry for many who have warned that careful monitoring by local authorities will be necessary in order to avoid increased real estate speculation as a result of the programme.
The Ministry of Construction will also identify industries that will have access to preferential loans.
