Many people said that it is necessary to remove the legal obstacles for the real estate market to recover quickly and develop more sustainably. Legality plays a very important role in the real estate market. In the past two years, all"incidents" of the market haveinvolved legality because the law followed the market but it was quite slow.

The real estate market will recover quickly if the overall solutions are
promoted by the Government. Photo: Internet

Breakthrough mechanism for low-price commercial housing

According to Deputy Minister of Construction Nguyen Van Sinh, the Covid-19 pandemic has not had a big impact on the real estate market but only affected some individual factors of the market, as well as operations of small and medium real estate businesses with weak financial potential. Most of the big investors with financial potential continue to implement projects. The supply of houses, especially middle and high-class houses, is still increasing due to the number of completed projects. The representative of the Ministry of Construction said that the negative factor is reflected in the consumption rate when the consumption of commercial housing products in the first five months of the year only reached about 14%, the lowest in the past four years, and only 40% ofthe same period in 2019.

The number of successful transactions decreased by 36.6% compared to the fourth quarter of 2019 and only equal to 14% of 2019. Office for rent also encountered many difficulties, resorts all stopped operating, business in thereal estate resortshadalmost no revenue.

One of the remarkable solutions to help the real estate market recover in the near future mentioned by representatives of the Ministry of Construction is the development of two housing segments, including social housing and low-price commercial housing. In particular, in the context of limited social housing when the supply does not meet the needs of the majority of low-income people, low-cost commercial housing targeting the middle-income segment will apply many mechanisms to focus on lowering project costs and attracting the attention of project developers.

In particular, a number of groundbreaking new mechanisms are proposed to promote this segment.

Mr. Vu Van Phan, Deputy Director of the Housing and Real Estate Market Management Department (Ministry of Construction), said that regarding the order of investment procedures, the Ministry of Construction considers cases where contractor appointment may be applied, accelerating the process of project development.

Administrative procedures will be shortened in the project evaluation stages, investment options, permittingconstruction that makes projects start soon.

“The old real estate projects have been entangled by site clearance. On a parcel of land assigned to the investor for implementation of the project, some are freeable, others are not. In this regard, we propose that the State stand out the ground clearance. When the law does not regulate this issue, we will propose the content under the authority of the Government,"Mr. Vu Van Phan said.

Regarding market developments in the post-Covid-19 period, Mr. Nguyen ThoTuyen, BHS Group's General Director, said that after the social distancing order was removed, trading activities in the market took place again. In the Northern market, a series of projects recorded attraction such as Vinhomes Ocean Park, Sky Oasis - Ecopark, Sky Oasis - Ecopark, Citadines Marina Ha Long, or projects in the South such as Aqua City, Waterpoint, Sky GEM Land,World Long Thanh. One of the reasons leading to the activitiesof the market after the pandemic passed, according to Tuyen, is because some legal questions have gradually been concerned.

“A series of good information for the market related to legal disassembly such as issuing books to condotels, Decree 25/2020/ND-CP detailing the implementation of a number of articles in the Bidding Law, Ministry of Construction allowed the construction of small apartments of at least 25m2, and the Ministry of Natural Resources and Environment has withdrawn the regulation prohibiting the sale of plots on the outskirts of Hanoi and Ho Chi Minh City in the draft Decree amending and supplementing a number of decrees detailing the implementation of the Land Law drafted by the Ministry of Natural Resources and Environment. These are very important points to remove for investors as well as the real estate market,”Mr. Nguyen ThoTuyen said.

Needing strong push from legal issues

Commenting on the recovery of the market after Covid-19, economist Le XuanNghia said that some basic segments such as industrial real estate, affordable housing, land plots and luxury apartments, shop-house may recover soon after the economic recovery. Other segments such as office and resort real estate may recover more slowly.

According to Mr. Nghia, there should be specific measures for the real estate market.

“The biggest obstacle to reviving the real estate market is legal issues and administrative procedures such as bidding for public land, leased land, land clearance procedures, land lots for sale, and non-transparency from regulations planning to procedures for changing the purpose of use. To overcome this extremely complicated situation, it is necessary to have a specialized agency to review all legal regulations, help to amend laws, simplify procedures and regulations, dealing with transparency and this must be done continuously for several years,”expert Le XuanNghiasaid.

Regarding the legality of the real estate market, many people think it is necessary to remove legal obstacles for the real estate market to recover quickly and develop more sustainably.

Mr. Trinh Van Quyet, Chairman of FLC Group,said there are projects of hundreds of hectares of investment, after investing in enterprises, they are guided to bid, then to auction, each place has a different understanding leading to enterprisesfacingmany difficulties. With the current mechanism, businesses must take at least three years to have enough licenses to execute after completing all legal procedures.

According to Mr. Nguyen Tuan Hai, Chairman of Alphanam Group, the law is a "dangerous disease" that can easily lead to a biggercrisis than Covid-19.

In order to help the real estate market recover quickly after the pandemic, Mr. Hai said: “Covid-19 taught the economy a lot of lessons, look at the world and lookatVietnam to see the existing problems. The real estate market needs to treat the "legal disease" early in the same way that people infected with Covid-19 cure the underlying disease.”