IMG participates in the Conference to assess the situation and remove difficulties for the real estate market chaired by the Prime Minister

Date Submitted: 03-08-2023
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On the afternoon of August 3, Prime Minister Pham Minh Chinh chaired an online conference to evaluate the implementation results of Resolution No. 33/NQ-CP dated March 11, 2023 of the Government and propose solutions to remove difficulties and obstacles for the real estate market. The Prime Minister requested ministries, branches, localities, businesses, people and related entities to join hands to remove obstacles and promote the stable, safe, healthy, effective and sustainable development of the real estate market.

Mr. Le Tu Minh - Chairman of the Board of Directors of IMG Investment Joint Stock Company participated and gave a speech at the conference.

Mr. Le Tu Minh, Chairman of IMG Investment Joint Stock Company: The essence of removing difficulties for the real estate market that the Government is interested in lies in 3 issues.

The first is to prevent land speculation. Currently, people buy land waiting for the opportunity to increase prices, causing a part of the production force to "sleep" and not be effective, which is a waste.

The experience of other countries is to use taxes to regulate speculation. We have a project in Australia, every year we have to pay 2% land tax. The land price is independently assessed by the tax authority every year. Every year, we have to pay 700,000-800,000 USD in land tax when the project has not been implemented. This year, the local government decided to increase this tax rate to 4%, which is very high.

If Vietnam implements this policy, only those who really do projects will dare to hold land, and when holding land, they have to carry out the project very quickly. This measure not only prevents land speculation but also helps the Ministry of Finance have a large source of revenue.

We recommend that the Drafting Committee of the Land Law supplement and apply a 2% annual land tax rate and apply a progressive tax when land plots are not put into business and do not generate profits, as is being done in foreign countries.

Second, we thank the State Bank of Vietnam for taking timely measures to stabilize the real estate market, but the increase in interest rates should be time-limited and quantitative.

It is time to reduce medium-term interest rates to below 10%. Developed countries apply medium-term interest rates of 3-5%. With high medium-term interest rates, businesses do not want to borrow, do not dare to borrow, and customers put money into other areas instead of real estate. Medium-term interest rates should be reduced to around 8.5% plus or minus as 2 years ago, so that Vietnam can continue to be an Asian dragon.

There should be measures to prevent or restrict real estate enterprises from participating in banking and vice versa because enterprises participating in both fields mobilize social capital mainly for their own enterprises and have little effect on society.

Third, remove legal obstacles and handle administrative procedures. The biggest difficulty for real estate enterprises today is that the law has overlaps, the same issue, the same regulation but many interpretations, the enforcement level does not implement and does not dare to do, mainly at the local level.

In enterprises, we assign work with deadlines, if officials miss the deadline without a valid reason, and do not have the approval of their superiors to adjust, they will be fined or transferred to another job. However, it does not matter if state officials are slow or do not do it. We clearly understand that losses due to delays in progress are greater than losses due to embezzlement.

It is recommended that there should be clear regulations on the decentralization of authority and responsibility of all levels, including clearly stipulating: completion content, completion time, and responsibility if the deadline is exceeded.

The IMG leader also proposed that the Ministry of Planning and Investment allow Vietnamese enterprises to extend the land lease term or allow enterprises to pay land rent for 70 years so that industrial parks have sufficient duration and are attractive enough to partners to lease land. This is both in accordance with the law and increases local revenue.

The conference was chaired by Prime Minister Pham Minh Chinh. Also attending were Deputy Prime Minister Le Minh Khai, Deputy Prime Minister Tran Hong Ha; Ministers of Construction, Finance, Natural Resources and Environment, Planning and Investment, and Governor of the State Bank of Vietnam (SBV).

On the National Assembly side, the Economic Committee and the Law Committee were invited to attend the meeting.

Also invited to the conference were Chairmen of People's Committees of provinces and cities.

The conference was also attended by 6 major banks Vietcombank, Vietinbank, BIDV, Agribank, Techcombank, MBbank and a series of leading real estate corporations such as Vingroup, SunGroup, Novaland, IMG, GP.Invest, Ecopark, Geleximco, Hoang Quan, Becamex IDC, Hung Thinh...

The corporations HUD, Handico, UDIC, Hancorp and enterprises in the construction sector such as Vinaconex, Hoa Binh.

The Ho Chi Minh City Real Estate Association (HoREA) was also invited to attend the conference.

Thủ tướng Phạm Minh Chính phát biểu chỉ đạo hội nghị. Ảnh: Dương Giang/TTXVN

Real estate market shows signs of positive recovery

Speaking at the conference, Prime Minister Pham Minh Chinh emphasized that, despite many difficulties and challenges due to external and internal impacts, with the strong and effective leadership and direction of the Party, the entire political system, the participation of the business community, people and international friends, the socio-economic situation in the first 7 months of 2023 of the whole country continued to change positively.

Thủ tướng Chính phủ Phạm Minh Chính phát biểu tại hội nghị.

The macro economy continues to be stable, inflation continues to decrease, major balances are ensured, the economy continues to grow, and production and business activities are gradually improving. Public debt, government debt and budget deficit are under control. The real estate sector has made a very important contribution to the overall socio-economic results.

According to the Prime Minister, real estate and the real estate market play an important role in the economy, directly and widely affecting people, businesses, economic growth and development; currently, the cash flow and credit of the economy are all related to real estate.

After the Government issued Resolution No. 33/NQ-CP dated March 11, 2023 on a number of solutions to remove obstacles and promote the safe, healthy and sustainable development of the real estate market. Ministries and sectors have proactively and actively researched, developed, issued and advised and proposed to the Government and the Prime Minister to issue many mechanisms and policies to promptly remove obstacles and difficulties in the real estate market...

Along with many other specific policies on banking, credit and investment, the real estate market has shown signs of positive recovery.

This shows the strong and drastic commitment of the Government in accompanying and rescuing the real estate market to avoid the real estate market falling into a state of mass collapse, affecting the recovery and development of the economy.

Hội nghị trực tuyến đánh giá kết quả thực hiện Nghị quyết số 33/NQ-CP ngày 11/3/2023 của Chính phủ và đề xuất các giải pháp tháo gỡ khó khăn, vướng mắc cho thị trường bất động sản.

The Prime Minister pointed out that, in addition to positive contributions, the real estate market's activities in recent times still show signs of instability and unhealthyness, the recovery is still slow, real estate businesses still face many difficulties; the shortcomings and problems of the corporate bond and real estate markets have only been initially handled, not fundamentally, sustainably and effectively resolved.

"Problems that have existed for many years cannot be solved overnight; they must be solved step by step, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is, the more difficult it is; ... "All levels, ministries, branches, enterprises and people must uphold the responsibility of each entity, join hands to solve the problem, with the spirit of "harmonizing interests between the State, enterprises and people", "harmonizing interests, sharing risks", to promote the real estate market to develop stably, safely, healthily and sustainably" - the Prime Minister emphasized.

Many real estate projects still face difficulties and problems.

Reporting at the conference, Deputy Minister of Construction Nguyen Van Sinh said that in the second quarter of 2023, the supply of real estate and housing was still limited, with 07 completed projects with 2,424 units (852 apartments; 1,572 individual houses), the number of projects was only about 50% compared to the first quarter of 2023 and about 29.17% compared to the second quarter of 2022, the implementation was delayed or stopped completely due to many projects facing difficulties in legal matters, capital sources, etc.

In the second quarter of 2023, there were 96,977 successful transactions; the transaction price of new apartment real estate in some major cities such as Hanoi and Ho Chi Minh City was assessed to have increased in some areas although the real estate market was showing signs of slowing down; resort real estate prices continue to decrease, however, the decrease is not as much as at the end of last year due to current high capital costs; the selling price of villas and project land in many localities in the quarter continues to decrease by about 2% to 5% compared to the previous quarter and may continue to be adjusted to appropriate values, commensurate with the investment value of the product and regional infrastructure in the coming time.

According to the report of the State Bank of Vietnam, as of May 31, 2023, outstanding credit for real estate business activities reached VND 925,796 billion, the structure and credit for real estate business in the first 5 months of the year increased by 14%. Capital from corporate bond issuance for the real estate sector in the second quarter of 2023 fluctuated significantly in June 2023 with 13 separate issuances with a total value of VND 8,170 billion with high interest rates compared to the general level of 12-14%, a sharp increase compared to May 2023, with only one enterprise successfully issuing with a total value of VND 2,600 billion (source: Vietnam Bond Market Association).

At the conference, leaders of ministries, branches and localities assessed the current status of what has been done and what has not been done by each agency and unit in the process of implementing Resolution 33 and related policies of the Government and Prime Minister. At the same time, what are the proposals and solutions to handle real estate projects that are facing legal problems, have to stop operations, and cannot bring products to the market due to legal problems to free up land resources, investment capital, and reduce the risk of bad credit debt. Difficulties and obstacles in implementing the Project "Investing in the construction of at least 01 million social housing apartments for low-income people and industrial park workers in the period of 2021-2030.

After listening to the opinions of leaders of ministries, branches, localities and enterprises, Prime Minister Pham Minh Chinh emphasized that the real estate sector is one of the pillars of the economy, attaching importance to regulating and restoring the market along with risk control. The Government and the Prime Minister resolutely direct and accompany localities and enterprises to remove difficulties for the real estate market.

Thứ trưởng Bộ Xây dựng Nguyễn Văn Sinh báo cáo kết quả thực hiện Nghị quyết 33 của Chính phủ về thị trường bất động sản

The Prime Minister said that after the Government issued Resolution No. 33/NQ-CP dated March 11, 2023 on a number of solutions to remove obstacles and promote the safe, healthy and sustainable development of the real estate market. Ministries and branches have proactively and actively researched, developed, issued and advised and proposed to the Government and the Prime Minister to issue many mechanisms and policies to promptly remove obstacles and difficulties of the real estate market... Along with many other specific policies on banking, credit and investment, the real estate market has shown signs of positive recovery. This shows the strong and drastic commitment of the Government in accompanying and removing obstacles for the real estate market.

The Prime Minister requested that, closely following the Party's guidelines and policies and the State's policies and laws, directing and operating proactively, flexibly, creatively, promptly and effectively, ensuring compliance with the situation and practical requirements; not criminalizing economic-civil relations; protecting officials and those who do the right thing; harmonizing the interests of the state, people and businesses, not being confused, wavering, or fearful in the face of all difficulties, challenges, and fluctuations, but at the same time not being intoxicated by victories, not being negligent or subjective when the situation is more favorable, not losing opportunities.

Regarding the general tasks, the Prime Minister requested that ministries, branches, and localities, according to their assigned functions and tasks, continue to urgently and strictly implement the tasks in Directive No. 13/CT-TTg; Resolution No. 33/NQ-CP of the Government on solutions to remove obstacles and promote the safe, healthy, and sustainable development of the real estate market and the Prime Minister's instructions.

Focus on promoting the development of social housing (according to Decision No. 338/QD-TTg dated April 3, 2023 of the Prime Minister), disbursing public investment capital and preferential loan sources to create motivation, spread, and promote production and business activities.

Regarding specific tasks, the Prime Minister assigned the Ministry of Construction to continue researching and completing the dossier for drafting the Housing Law (amended), the Real Estate Business Law (amended) to report to the Government, submit to the National Assembly for consideration and approval at the 6th session in October 2023, ensuring the consistency, unity, and feasibility of the legal system.

Coordinate with ministries and branches to direct and guide localities and enterprises to effectively implement the Project "Investing in the construction of at least 1 million social housing apartments for low-income people and industrial park workers in the period of 2021-2030"; Guide and urge localities to review, establish and publish a list of investors in social housing projects, worker housing, and apartment building renovation and reconstruction; continue to carry out the task of reviewing, urging and guiding the removal of difficulties and obstacles in the implementation of real estate projects for localities and enterprises in provinces and centrally run cities.

The Prime Minister requested that the State Bank of Vietnam continue to review credit lending to real estate enterprises; have appropriate and effective solutions for enterprises, real estate projects and home buyers to access credit capital more conveniently, contributing to removing difficulties and promoting the development of the real estate market safely. safe, healthy, effective and sustainable. In particular, for the effective implementation of the Credit Program of about 120,000 billion VND for preferential loans to develop social housing, workers' housing, and renovate and rebuild apartments.

The Prime Minister assigned the Ministry of Planning and Investment to direct, urge and guide localities to remove difficulties and obstacles in investment procedures, approve investment policies for housing and real estate projects, including social housing in urban areas and workers' housing to increase supply to the market.

The Ministry of Finance carefully and specifically reviews and evaluates the payment capacity of organizations and enterprises issuing bonds, including real estate enterprises, especially bonds due for payment in 2023 and 2024.

Control capital mobilization activities of real estate enterprises on the stock market, avoid speculation, manipulation and price inflation. At the same time, there are effective solutions to promote the development of the stock market and the issuance of healthy and sustainable corporate bonds.

The Ministry of Natural Resources and Environment urgently completes and submits to the Government for consideration the issuance of a Decree amending and supplementing Decree No. 44/2014/ND-CP dated May 15, 2014 on land valuation methods; developing and adjusting land price frameworks and land price tables; specific land valuation and land valuation consultancy activities according to simplified procedures; and at the same time, guide localities to resolve difficulties and problems related to land valuation.

For localities, the Prime Minister requests that they implement the tasks and solutions of Resolution No. 33/NQ-CP dated March 11, 2023 on a number of solutions to remove and promote the safe, healthy and sustainable development of the real estate market; focus on reviewing and removing difficulties and problems in implementing real estate projects in the area; Urgently and focusedly implement the tasks specifically assigned in Decision No. 338/QD-TTg dated April 3, 2023