Slow projects under threat of cancellation
Slow projects under threat of cancellation
Property projects that have yet to implement site clearance and compensation agreements despite being granted licences should be suspended, Construction Minister Trinh Dinh Dung told developers in an industry meeting last Saturday.
Dung said if real estate developers insisted on investing in these long gestating projects like they did during the property market boom several years ago, they would face losses and potential bankruptcy.
"We should have policies that encourage businesses to suspend incomplete projects in order to help them avoid further losses," Dung stressed.
Speaking with the HCM City Association of Real Estate Developers, Dung said that in order to make more effective policies the Ministry is now very closely monitoring the current demand and supply situation for property.
The Ministry is also classifying the present status of each ongoing project to find those that have yet to implement site clearance and compensation procedures, especially in Ha Noi and HCM City.
"Based on research we will compile statistics on the number of projects and their scale in each locality and ensure that they are appropriate for supplying the demand there," he added.
Representatives of the developers at the meeting also requested that the Ministry reviews policies on investment procedures, interest rates and land use fees.
According to figures released by the HCM City People's Committee, the city is forecast to have a population of near 10 million people by 2025, in addition to 2.5 million non-residents with temporary stays of under six months.
Just over 7 million residents will live in inner-city districts, with about 3 million in suburban districts.
To meet demand the city is expected to allocate up to 100,000 ha for construction, with 49,000 ha in inner districts and 40,000 to 50,000 ha in suburban districts.
Of the 882 housing projects that have been licensed in the city, investors have completed land hand-overs, site-clearance compensation and infrastructure development for 785 projects.
More than 50 per cent of the compensation needed for site clearance has been completed for 45 projects. Fifty-two projects have completed less than 50 per cent of the compensation for site clearance.
Most of the 1,143 property projects to develop warehouses, office buildings and business centres have completed compensation for site clearance.
According to the city People's Committee, most delays in compensation for site clearance are projects that are funded from the State budget.
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