Minister for Construction Trinh Dinh Dung spoke with the Lao dong (Labour) Newspaper about measures to handle shortcomings in the implementation of the Government's social housing plan.

What do you have to say about the implementation of the government resolution 02 on social housing in the recent past and why do you think the resolution needs to be revised?

Firstly, I have to say that the resolution has created positive reactions that has enthused the country's real estate market. Transactions have increased in Ha Noi, HCM City and many other cities from June 2013 to June 2014. In the first six months of 2014, Ha Noi has had 4,150 transactions, an increase of 200 per cent compared to the same period last year. Real estate prices have been stable and supply sources have increased along with the decrease of real estate stock.

However, the real estate sector still has a lot of problems due to licensed projects far exceeding the demand of the market. There are more than 4,000 licensed projects with more than 100,000 hectares that require between 15 to 20 years for construction.

The demand for social housing is also very high. The country needs around 1.3 million apartments by 2015, but the ability to respond is very low, especially with regard to social housing for workers in economic and industrial zones. The State Bank's credit package on housing support has many priorities, but with high interest rates, the short borrowing time exceeds the paying ability of poor families. Implementation of social housing projects has also faced hurdles due to the slow process of procedures or because the land fund for social housing hasn't met the demand. Due to all these reasons, I think it is time to revise Resolution 02 and tackle the shortcomings in the real estate sector.

Demand for social housing is very high. How will the Resolution 02 be revised and what are the changes?

In order to handle shortcomings of the real estate market and support households facing housing difficulties, there is a need to prolong the maximum period of grace for households and individuals from 10 years to 15 years. I am aware that the proposal has received support from the State Bank and the Ministry of Finance.

Secondly, it is necessary to expand beneficiaries of the Government credit package of VND30 trillion, in which borrowers are households, individual investors, tenants or those responsible for social housing to workers in industrial zones and students.

What we should do right now is to provide incentive loans from that credit package to families, individuals, officials, armed forces and urban workers who find it difficult to get homes, but don't receive any support from the State. The State Bank and the Ministry of Finance have also backed the policy.

Many localities haven't really encouraged enterprises to develop social housing. What should be done to handle such a situation?

I think the resolution should have a regulation wherein localities have to promulgate policies for supporting and providing land incentives or favourable conditions to social housing investors. In fact, many enterprises are looking to get land for building homes for their workers. In addition, it is important to provide households and individuals investing in social housing projects with instructions on procedures, design criteria and loan support. — VNS