Gov`t plans flats for low-income earners

HCM City (VNA) - The Ministry of Planning and Investment will spend 2.5 trillion
VND (151.2 million USD) to build a total of 10,000 apartments for low-income
residents over the next two years in Ho Chi Minh City and Hanoi , according to
Deputy Minister of Construction Nguyen Tran Nam .

HCM City has 250,000 labourers working in local EPZs and IZs, 70 percent of
whom are migrant workers from local provinces.

Only eight residential buildings and four low-cost housing blocks, accommodating a
total of 6,000 people, have been built in HCM City in recent years, meeting
just three percent of demand.

The ministry said land shortages and high interest rates on bank loans had
deterred developers from investing in low-income housing.

In addition, few preferential policies exist for investors to pour money into
low-income housing projects, which are often viewed as unprofitable.

The ministry hopes that its investment plan will stimulate growth in the low-cost
property market.

Property developers, for their part, have asked the Government for lower interest
rates on bank loans and simpler site clearance procedures and construction
permits.

Many developers have been selling low-cost units for 500-700 million VND
(36,000-42,000 USD) each, prices that are too high for low-income groups.

Construction Ministry officials have told property developers that the ceiling
cost for the houses must be 500 million VND (36,000 USD).

Developers will receive incentives from the Government if they make a commitment
to build low-cost housing, according to the ministry.-Enditem