PM approves the plan to establish housing saving fund

Prime Minister has approved the plan of establishing the housing saving fund in form of non-profit organization with the voluntary contribution equalling to 1% of monthly salary of employees.
The information was made by Vice Minister of Construction Nguyen Tran Nam at the conference on interaction between real estate and finance markets in Vietnam, held by the National Finance Supervision Committee.

Nam said that the housing saving fund will be constituted by the labour voluntarily by deducting 1% of their monthly salary with an interest rate of 3-5% a year.

After that, the fund will prioritize to lend people to buy houses and set aside a certain amount to help construction firms join the social housing development program.

Those who do not demand for housing will be able to withdraw all savings in this fund (both principal and interest) as they retire.

By 2020, Vietnam needs 2.5 billion square meters of new housing to meet the demand of 96 million people, the Ministry of Construction expected. The country now has around 1.4 billion sqm, 70% of which was contributed by the people. 70% of real estate investment capital is lent from banks.

“Housing saving fund will be a bridge to help the poor and the low income earners have chance to buy houses”, Nam confirmed.

Data of the ministry showed that there was 7 million people demanding to rent or buy social housing with total 150 million sqm in urban areas, equalling to the investment capital volume of 300-400 trillion dong. It indicated that the demand is very high.

Tags: housing saving fund, Vietnam Property market, Vietnam property sector, vietnam real estate market