Real Estate Association suggests developing smaller apartments in Hanoi

As development in Vietnam progresses, the HCMC Real Estate Association has suggested building 20 to 70 square metre apartments in residential areas in Hanoi reported Tuoitre News.

HoREA chairman, Le Hoang Chau stated that building these smaller apartments is the best direction to head especially with the urban planning of each locality. He also noted the difficulty the real estate market has gone through which has in turn caused developers, investors, and consumers various problems.

Binh Duong-based Becamex IDC recently began plans for 3,000 apartments in Ciputra Hanoi, 30 square metres each in response to low income individuals.

apartments in Hanoi

According to Tuoitre News, property trading remains dull, leading to a slump in the market liquidity. Industries such as steel, cement, and interior furnishing have also experienced this slump.

In regard to these shortages and sky-high lending rates, property enterprises are faced with the challenge of finding solutions to restructure business and investment, postpone projects, and offer promotional programs, such as discounts to raise demand.

Since the deposit rate ceiling was lowered by one percentage point this month the market has not improved. Constructing new residential units such as the smaller 20 to 70 square metre apartments is one way the association is looking to increase sales and regain consumer confidence.

apartments in Hanoi

According to HoREA, there should be a specific schedule to reduce lending rates to 11 per cent 12 per cent per year. It was also suggested that the government adopt a policy to offer consumers preferential interest rates for their first house purchase.

In addition, the association proposed removing the land use fee usually tagged on Hanoi property projects and rather impose a 10 per cent to 15 per cent tax rate.