BIDV to offer loan for low-cost housing
BIDV to offer loan for low-cost housing
The Bank for Investment and Development of Viet Nam (BIDV) will provide a line of credit of VND2 trillion (US$96 million) over the next two years to support the construction of the social housing projects.
To support investors in hastening housing projects for low-income people and workers, loans will be provided with a preferential interest rate equal to that of the Viet Nam Development Bank under the guaranty of the Ministry of Construction, currently about 14.4 per cent per year, or 3-4 per cent lower than prevailing market rates.
BIDV chairman Tran Bac Ha, addressing a signing ceremony with the ministry on Wednesday, said that priority would be given to unfinished housing projects in crowded urban areas and in industrial zones with large numbers of workers.
Deputy Minister of Construction Nguyen Tran Nam said the ministry would co-ordinate with BIDV in evaluating projects to decide on loan allocations. About 20 projects would benefit with a credit limit up to VND200 billion ($9.6 million) per project, he said.
Loan agreements were already signed with four investors, including Vinaconex Xuan Mai, Viglacera Corporation, the Compensation and Site Clearance Co and the Duc Manh Co, all of which were building affordable housing in Vinh Phuc Province, Ha Noi, Da Nang and HCM City.
The investors have pledged to speed up the construction process and minimise costs in an effort to lower prices of apartments and make them affordable to low-income people.
BIDV was also considering a support package of about VND2 trillion (US96 million) to help low-income people buy homes in these projects. The support package might be worth a total VND17 trillion ($809.6 million) by 2015, the bank said.
The ministry has reported that 42 low-income housing projects were under construction nationwide, expected to provide living space for over 73,000 people. However, by the end of last year, projects were completed to accommodate only 8,000 people.
The ministry blamed a lack of capital for the slow pace of development and also noted that the price of apartments, ranging around VND13-15 million ($620-720) per square metre, still remained out-of-reach for low-income people. Nam called on other banks to provide similar loan incentives to help boost the construction of affordable housing.
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