The government will allocate VND 3,000 billion from the budget to low-income people to buy houses through policy and commercial banks.

According to the Resolution of the Government’s regular meeting of March, the Ministry of Planning and Investment was assigned by the Government an additional VND 1,000 billion to Vietnam Bank for Social Policies and VND 2,000 billion to subsidize interest rates for 4 commercial banks designated by the State Bank. This is intended to support social housing loans.

The Ministry of Construction is assigned to study and adjust inadequacies in Decree 100/2015 to submit to the Government for consideration and promulgation in the fourth quarter according to simplified procedures; propose renovation of policies and mechanisms to solve basic housing issues for low-income people. The ministry will also coordinate with localities, especially Hanoi and Ho Chi Minh City, to promote the development of social housing to meet the needs of low-income people, especially workers.

The Government decision was made after businesses and associations proposed more preferential loan packages for social housing buyers due to the market’s difficulty after the 30,000 billion VND home loan package ended.

Reflecting the recent Chairman of the National Assembly, the Vietnam Real Estate Association (VNREA) said many social housing developers are hard to sell because buyers are not supported with loans. This unit proposes to increase funding support for low-income people to buy social houses in two channels: the Social Policy Bank and the State-owned commercial bank.

Every year, the State grants 50% of the capital to the Social Policy Bank and mobilizes an additional 50% from various channels to support buyers, rent-purchase social houses, in accordance with the Housing Law. 4 commercial banks, including Vietcombank, BIDV, Agribank and Vietinbank, are governed by the State and are granted interest rate subsidies of 3-4%, the rest mobilize 100% to lend.