Social Housing Development Savings Fund: Focus on low-income earners

The Ministry of Construction has submitted a proposal to the Government for approval of the Social Housing Development Savings Fund Project, with two housing savings models, based on research on the current housing situation and housing finance in Vietnam. The two housing savings models will meet the loan needs of low-income earners and other individuals and households who want to buy commercial housing.

Social housing development savings fund to help low-income people,

Poor households can borrow to buy or rent social housing.

Photo: Hoang Long

In the first model, the Ministry of Construction proposed to establish a Social Housing Development Savings Fund to help low-income people and poor households borrow money to buy or rent social housing. In addition, this Fund can also lend money to these people to renovate or repair their houses or lend money to businesses to invest in building social housing.

With the second model, the Ministry of Construction proposed to establish a Housing Savings Fund, which will be for individuals and households in the country to borrow to buy commercial housing, mainly focusing on those with average income or higher.

Deputy Minister of Construction Nguyen Tran Nam said that the capital to form the Social Housing Development Savings Fund is mobilized from the existing capital sources of the Housing Development Fund (including at least 10% of the proceeds from the transfer of land use rights of commercial housing development projects, new urban area projects; local budget annual support for the fund; money mobilized from other legal sources). In addition, there are savings contributions and debt repayment sources of subjects who need to participate in contributing to the fund in the locality, capital from the central budget initially allocated one time to each local fund, 30% of profits from lottery issuance or all profits from housing lottery issuance issued by local lottery companies...

In addition, the Social Housing Development Savings Fund will be mobilized from capital sources from purchasing mandatory housing bonds issued directly by the Fund but guaranteed by the Government (called Government-guaranteed Bonds) applicable to a number of real estate-related activities such as granting housing construction permits, conducting real estate transactions, transferring real estate, registering real estate business and providing real estate services. The money to purchase these bonds is calculated by a specific amount or a percentage of the real estate value when transacting, which will be regulated by the Ministry of Finance. In addition, the Fund will also mobilize capital borrowed from the Social Insurance Fund. Based on the Prime Minister's permission in the decision approving this project, the Ministry of Finance will have specific instructions on capital borrowed from the Social Insurance Fund.

Deputy Minister Nguyen TranMaleaffirms that participation in the fund is voluntary, not mandatory. The fund participants are those who need to contribute savings to the fund to borrow to buy or rent social housing or to renovate or repair houses. Only those who participate in the fund can borrow money from the fund to carry out the above tasks. After the Government's decision to approve the project, the Ministry of Construction will preside over and coordinate with relevant ministries and branches to develop the operating regulations, mobilization and lending mechanisms, operating principles, and financial mechanisms of the fund, expected to be submitted to the Prime Minister for approval in the first quarter of 2013.

According to Daidoanket - nt