The Vietnam Real Estate Association (VNREA) will next month propose solutions to Prime Minister Nguyen Xuan Phuc to remove difficulties in administrative procedures, capital and cut loan interest for real estate businesses.

A perspective of a social housing project in Hanoi's Long Bien District. Fund for social
housing segment is one of the issues highlighted at the conference on real estate market
development held in Hanoi on February 18. — VNA/VNS Photo 

VNREA Chairman Nguyen Tran Nam made the announcement at a conference held by VNREA in Hanoi on February 18, which was attended by leaders of the Construction Ministry and representatives of large property developers including Vinhomes, Sun Group, FLC, Novaland, BRG and Phuc Khang.

The conference aimed to discuss businesses’ difficulties in terms of the State's policies on the real estate market, as well as solutions to aid the market’s stable and sustainable development.

Speaking at the conference, CEO of Eurowindow Holding Nguyen Thi Quynh Chi said it was no coincidence that Prime Minister Phuc directed to listen to businesses' opinions at present, especially amid the spread of the novel coronavirus (COVID-19), which has had a great impact on resort real estate.

“Eurowindow Holding recommends the Prime Minister support resort real estate businesses with specific policies such as tax reductions and interest rate cuts to help us develop,” Chi said.

Regarding real estate in general, Chi said it was difficult for her company to carry out its plans this year as recent sales did not have many customers. Along with that, the supply of real estate and transactions this year might fall due to legal obstacles.

"I think one of the main policies should focus on capital for real estate businesses. In addition, we really want VNREA to continue sending the Government recommendations to revise some regulations of Decree 20 [which manages the taxes of enterprises that have associated transactions to prevent transfer pricing],” Chi added.

Bui Viet Son, Chairman of Thang Long Confectionery Co., Ltd, said the social housing segment still faced many difficulties because investors and customers could not access capital resources with preferential interest rate.

Son proposed the Government direct commercial banks to issue interest exemptions or reductions for social housing projects.

“If the banks give us interest rate support, we will borrow capital to continue developing social housing projects for the poor,” he said.

CEO of FLC Huong Tran Kieu Dung said she saw difficulties related to three major problems, namely legal issues, capital and administrative procedures.

“Regarding capital, the Government’s VND30 trillion housing stimulus package ended in 2016. The real estate market is in a difficult period, looking forward to new funding sources and new credit packages to stabilise the market,” Dung said.

In term of legal issues, Dung said there were overlaps and lack of synchronism among laws, greatly affecting real estate projects.

“If these overlaps are cleared, the real estate projects will be strongly developed.”

“In the past two years, localities have been very concerned about project approval. There are few provinces allocating land to businesses. If this situation is not solved, the number of projects approved for construction will be very few next year, reducing opportunities for local economic investment,” Dung said.

"Doing all formal procedures to build a project takes at least two years, causing difficulties and missing investment opportunities for us,” she added.

CEO of Vinhomes Pham Thieu Hoa said his business had gathered ideas from its subsidiaries to produce 14 pages of administrative problems affecting its operations, relevant to condotels, officetels, red books for foreigners buying houses and inadequacies in bidding for investor selection and investor approval, and Build-Transfer construction projects.

Chairman of GP.Invest Nguyen Quoc Hiep said among businesses operating in Vietnam, the real estate sector faced the most difficulties because they are governed by 10 types of laws, with administrative procedures seen as a ‘matrix’ surrounding businesses.

“The best solution is to revise laws,” Hiep emphasised.

Hiep took an example in the northern province of Phu Tho as businesses are struggling to overcome many legal procedures in terms of land.

“There are projects that have to go through five departments and many ministries and branches, some have had to go through five generations of provincial People’s Committee Chairmen but have not been implemented so far.”

“That is not to mention a series of difficulties in land compensation in projects related to land price differences,” he added.

After listening to businesses, VNREA Chairman Nguyen Tran Nam summarised four issues to be proposed to the Prime Minister, including problems of Decree 20’s regulations, legality for real estate projects, administrative procedures and removal of difficulties in capital and interest rate reduction.

“We will make a comprehensive document on market information, proposing issues related to laws, regulations, documents and detailed solutions to the Government," Nam said.