Property loans need standardising

The Ministry of Construction (MoC) has asked the Government to draw up property loan standards for credit organisations in order to regulate the domestic real estate market.

According to the proposal, the standards would create conditions for real estate investors with a real demand for capital to access loans for financially viable projects. The ministry also asked the Government not to consider the property industry as a non-production industry because its development had a knock on effect on other industries.

Construction enterprises have agreed with the proposal.

Le Khac Hiep, Chairman of Vincom Group, said the State should have specific regulations on bank loans to create favourable conditions for property developers.

The ministry also suggested that property transactions should not be conducted in cash.

According to the ministry, over the past 10 years, the number of enterprises investing in real estate has increased by 20-50 per cent per year.

The ministry said the direction of housing and apartment projects was uneven because enterprises had focused on developing luxury apartment and villas while demand was really in the middle and low end bracket.

The ministry expected this to change soon and for the market to make a strong recovery. — VNS

Tags: property loans, Vietnam banking industry, Vietnam finance, Vietnam financial