Governor of the State Bank of Vietnam Nguyen Thi Hong (Photo: VietnamPlus) Hanoi (VNA) – Governor of the State Bank of Vietnam (SBV) Nguyen Thi Hong has called for close coordination between stakeholders to remove bottlenecks for the all-important real estate market, which has a major impact on other economic sectors.
Attending a teleconference held on November 13, Hong stressed that a safe and sustainable realty market will drive other industries. He said despite drastic measures from the Government, the market is in choppy waters.
Removal of bottlenecks in credit, legal procedures
Legal procedures related to land, planning and investment are among the challenges that the realty market is facing.
Regarding the credit issue, property developers want to get access to funding at a lower cost with simplified procedures.
Dennis Ng Tech Yow, General Director of Novaland Group, said that making up 80% of realty enterprises’ difficulties, legal issues have left many firms in trouble.
If the issues are not handled in a timely manner, there will be a number of businesses going bankrupt in the coming months. He proposed the Government and the People’s Committees of cities and provinces complete general planning schemes as well as create favourable conditions for the companies to develop projects in line with the assigned tasks.
Besides, the Government and the National Assembly should consider fine-tuning the Law on Investment, ensuring that the investment – land handover – planning – license granting process is carried out in a fast and transparent way, he added.
According to Novaland, property firms have gone through the hardest time. However, they need support from competent authorities to overcome current challenges. Along with support in terms of monetary policy, the group expects that the fiscal policy will allow extension of tax payment deadlines for the whole 2023 and the first half of 2024.
Meanwhile, Nguyen Van Cuong, Vice Chairman of Hung Thinh Group, suggested the SBV expand credit room for commercial banks who have engaged in the restructuring of the real estate market and strictly complied with the Party and State’s policies and guidelines.
He also said banks should simplify lending conditions for property projects while delaying loan repayment for material building and construction firms.
Over the past time, contractors and building material suppliers have been allowed to take out loans in 6-12 months, which has exerted pressure on investors.
Legal procedures are among the formidable challenges that the real estate market is facing. (Photo: VietnamPlus) Falling confidence in home loans
SBV Deputy Governor Dao Minh Tu said with all conditions regulated in the laws, the SBV could not increase credit room.
Besides, enterprises are facing difficulties with the credit room granted by commercial banks to each customer, while the banking system’s room remains abundant, he added.
Vietcombank General Director Nguyen Thanh Tung highlighted that the property market is an important sector for the bank, with realty outstanding debts accounting for 25% of its total outstanding debts.
There is a scarcity of social housing projects, while many are struggling to find buyers, he said, blaming it to the fact that not many people are qualified to own luxury housing.
Besides, demand for property credit has decreased due to a fall in customers’ confidence in the realty market.
Although the lending interest rate slid 2.5% a year, home loans went down dramatically as customers are waiting for home prices to drop, he added.
Tung also recommended investors improve their financial capacity, meet commitment made with house buyers, and focus on the segment of high demand to gain trust from commercial banks.
Participants at the teleconference on November 13 (Photo: VietnamPlus) BIDV General Director Le Ngoc Lam said that as most of the affordable housing projects are facing challenges in legal procedures, the bank was able to disburse some 8 trillion VND (329.7 million USD) out of the approved amount of 26 trillion VND.
When the bottlenecks in legal procedures are removed, the bank will disburse the remaining money, he added./.
