Vietnam authorities unveil sweeping measures to rescue property sector

According to the Private Economic Development Research Board under the Prime Minister's Advisory Council for Administrative Procedures Reform (Board IV), the lack of funds and systemic problems have put most companies in a situation where they struggle to maintain partial operations. Vietnam's real estate market soared on the announcement that the government would extend loans to distressed developers.

To rescue or not to save the property sector?

Vietnam authorities have unveiled sweeping measures to rescue the struggling property sector as regulators seek to offset years of harsh pandemic curbs and a real estate crackdown that have stalled the world's No 2 economy. It said the "fall in trust" is a matter of concern. The challenges faced by property companies in the bond market after the events related to Tan Hoang Minh, Van Thinh Phat, and SCB Bank are spreading to all industries. Therefore, investors fear buying bonds and want to redeem even those issued by solid enterprises prematurely. The term "loss of trust" can be found in most articles about the South Korean bond market. When investors no longer trust and want to sell bonds, the prices will decline even further, which means companies can no longer raise funds through bonds, regardless of whether they are good or bad. The Prime Minister set internal directives to promote the "stable and healthy development" of the industry.

The measures include credit support for debt-laden housing developers, financial support to ensure the completion and handover of projects to homeowners, and assistance for deferred-payment loans for homebuyers. The new measures emphasized "guaranteeing the handover of buildings" and ordered development banks to provide "special loans" for the purpose, according to a copy circulating online.

PM unveils sweeping measures to rescue property sector

Prime Minister Pham Minh Chinh has tasked government bodies with dealing with the issues in Vietnam's property market to help it overcome challenges. The PM said in a statement that The Ministry of Construction served to propose changes to the overlapping regulations that hinder the development of property, housing, and urban projects. The ministry needs to review and choose construction project owners to develop social and worker housing projects to meet the one-million social housing target within the next ten years.

PM asked Nguyen Thi Hong - Governor of Vietnam's State Bank, to direct commercial banks to decline administrative costs and procedures that hinder capital provision to property firms. The Ministry of Finance was ordered to review corporate bonds and set solutions to eliminate ongoing problems in the market. Property developers must restructure their customer base, prices, and other details to make it more convenient for buyers.

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Source: khudothistarlake