Property firms ask for removal of policy bottlenecks

Real estate companies in HCMC at a roundtable meeting on Monday with the leaders of Vietnam’s National Financial Supervisory Committee (NFSC) expressed their worries over the property industry and proposed solutions to remove shortcomings of related policies to prop up the struggling market.

 Land usage fee is one of the nine matters discussed the most at the meeting on financial and credit policies for the realty industry in 2014 organized by the HCMC Real Estate Association (HoREA) and NFSC on Monday. Actually, this is not a new problem because after its launch in 2009, many seminars on the issue have been organized but no agreeable outcomes have been found as expected.

Nguyen Viet Tao, director of NVT Real Estate Company, noted that Decree 69 had driven property companies to the verge of bankruptcy as land usage fee they have to pay was subject to market levels, meaning they have to buy land twice, one from the land user and the second from the State. “We do not ask for money. What we need is a transparent mechanism,” Tao insisted.

Similarly, Binh Dan Real Estate Company after three years of struggling with the land usage fee payment has become inactive because of financial constraints. The firm said it was willing to transfer the whole project to the State and that it was seeking approval to convert the project into a budget housing scheme but had received no response accordingly.

Nguyen Xuan Quang, chairman of Nam Long Investment Corporation, complained that Decree 69 was putting huge financial pressure on local companies. In addition, when starting a property project, the investor cannot know for sure the amount of land usage fee it has to pay. According to Quang, no businesses in the industry are strong enough to develop new realty projects if they have to pay site-clearance compensation and land usage fee.

Truong Van Phuoc, vice chairman of NFSC, suggested that the problems of the policies on the real estate and housing market must be reconsidered, especially the way of setting land prices. Speaking with the participating companies, Vu Viet Ngoan, chairman of NFSC, promised to record all the matters of the realty market to report to the Government to seek solutions in the near future.

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