Buyers of low-income houses will soon be able to raise mortgages on their new properties, even when they are not built, according to the Ministry of Construction.

On June 25, the ministry gave the details of the 30 trillion VND (1.42 billion USD) support package set up for the purpose.

In Circular 11/2013 of the State Bank of Vietnam (SBV), issued in May, people who wished to borrow money from the support package for low-income home purchases must meet minimum capital requirements to be eligible for the loans.

This meant home buyers must borrow money, but current regulations did not allow the use of properties yet to be built as mortgage collateral, the ministry said.

So, allowing buildings still in the planning stages to be used as mortgages would make it easier for low-income earners to access bank loans.

Households or individuals having sale and purchase agreements with developers of social housing after January 7 would be eligible for the support package.

Those who sought loans to buy houses of less than 70sq.m at below 15 million VND (715 USD) per square metre must not own a house or must be living in accommodation at with less than 8sq.m per person.

Beneficiaries of the support package must be residing permanently in the province or city in which they wanted to buy. Those with temporary residence status must participate in social insurance for more than one year.

The support package would be available to investors in social housing projects or projects converted from commercial purposes regulated in Government Decree 71/2010/ND-CP and the Construction Ministry's Circular 02/2013/TT-BXD respectively.

The support package also covered investors of housing projects for students and workers in industrial zones.

The distribution of the support package must be completed within 36 months from June 1.

The ministry recently proposed to apply the same preferential loan to commercial apartments of below 90sq.m instead of only 70sq.m as currently regulated.

According to statistics from the Housing and Real Estate Market Management Department, as at the end of May there were 48 commercial housing projects registering to be converted to social housing. In Hanoi alone, there were 21.-VNA