The task force will be led by Minister of Construction Nguyen Thanh Nghi, Deputy Construction Minister Nguyen Van Sinh and Deputy Governor of the State Bank of Viet Nam Dao Minh Tu.

The task force consists of senior officials from the ministries of construction, planning and investment, natural resources and the environment, and public security, and the industries of banking, finance, according to a decision by Deputy Prime Minister Le Van Thanh.

It aims to remove obstacles for property businesses in Ha Noi, HCM City and other provinces.

The real estate sector plays a major role in the country’s economy, contributing 11 per cent of the national GDP. It also has organic relationships with other fields and creates many jobs.

Prime Minister Pham Minh Chinh has ordered a task force to be set up to remove challenges facing the real estate sector.-Photo sggp.org.vn

However, the sector has recently faced multiple problems such as capital shortage and low liquidity, which have caused many projects to be postponed.

In the context of banks restricting lending, enterprises have only one option left, which is to issue new bonds to pay for the previous issuance, experts said.

However, authorities are continuing to investigate and punish property and bond fraud while credit quotas remain limited, which have caused investors to lose faith in the industry, resulting in a large selloff as there are no buyers.

Many real estate businesses have had to borrow money from different sources at high interest rates or even sell off some of their assets.

At a recent meeting between the Government Office and representatives of the property industry, Le Hoang Chau, chairman of HCM City Real Estate Association (HoREA), said a number of property companies are facing the risk of falling liquidity and might have to make painful decisions to survive.

Many property developers are also scaling down their business as can be seen by investment or construction delays, he said.

They have stopped developing new projects, issuing new bonds or launching initial public offerings, he added.

Property developers have also been cutting their workforce, some by up to 50 per cent, according to Chau.

Experts said a huge amount of expiring corporate bonds due for payment in the last months of the year and 2023 and 2024 are putting great pressure on issuers, who are mostly property businesses.

A recent report on the corporate bond market by VCBS Securities Company showed that in the fourth quarter of 2022, there are about VND85 trillion of bonds issued by banks and real estate enterprises set to mature. The volume of corporate bonds maturing in 2023 and 2024 is estimated at VND790 trillion.

For real estate enterprises, the data of HNX also showed that by the end of the year, hundreds of billions of dong of bonds issued by realty companies will mature.

Experts said the challenges in the real estate sector are expected to last until 2024 as capital shortage, low liquidity and an expected global economic recession cast a shadow over the sector.