Vietnam still needs more affordable and low-income housing as getting new homes onto the market continues to be a problem. Ministry of Construction (MoC) data shows that only 41.4 percent of its low-income housing target in terms of area was built last year. The target had been set in the National Housing Development Strategy.
Local experts have noted that the number of low-income houses hitting the market in Vietnam isn’t close to meeting current demand. Additionally, prices for affordable and low-income homes have risen steadily.
“The State’s affordable housing developers can only meet 15 percent of the housing supply for immigrants and the rest of them have to take care of themselves,” Professor Dang Hung Vo was quoted as saying by the Vietnam Investment Review. “These people are in need of cheap commercial housing, ranging from VND700 million to VND1 billion each.”
Research from Savills Vietnam found that affordable and low-income apartments (units priced at VND2 billion or less) on the market account for roughly ten percent of the total number of units available.
“As the land fund was limited and the price of construction materials was increasing, the prices of houses would increase,” Vo Thi Khanh Trang, Savills Research Department Deputy Director, told the website. “In order to increase the supply for the low-price and affordable housing segment, it is necessary to have co-operation from local authorities with policies to support businesses to quickly solve administrative procedures and businesses which build such projects.”
Recently, MoC representatives met with housing experts from South Korea to learn more about their experience in building policy that supports affordable and low-income housing. One solution floated by the Korean delegation was to use money from the private sector to create a housing provision fund. This could be used to support additional low-income housing development moving forward.