Addressing the imbalance in the real estate market

Assoc. Prof. Dr. Nguyen Thi Mui, a member of the National Financial and Monetary Policy Advisory Council, gave this viewpoint. To overcome the hurdles in this phase, she believes that legal restrictions in the Land Law that are impeding the growth of the real estate market must be removed.

Policies must also be evaluated to address overlaps and conflicts. These challenges have impeded the country's economic progress and damaged public trust in the government's policies.

Resolving challenges to achieve growth objectives

The capital market, particularly the corporate bond market, requires development in terms of capital in general and bank credit in particular. The economy and enterprises are currently suffering from a lack of capital demand. Despite banks' abundant resources, many firms demand financing yet fail to fulfill the requirements for bank loans, including several real estate businesses.

As a result, experts recommend that all sectors work together to tackle the capital problem in production and business. The government should continue to pursue policies that encourage investment, consumption, and fiscal policies, therefore increasing the capital absorption capacity of firms.

Enterprises and business organizations must reorganize, improve their financial capacities, risk management, and competitiveness, and increase their capacity to absorb capital. To assist companies in developing, the banking sector should continue to analyze and eliminate expenses in order to reduce interest rates, reconsider loan conditions, and coordinate guarantee actions.

Besides, the real estate industry has a number of challenges affecting sectors such as building, interior design, and financing, the majority of which are founded in legal difficulties. As a result, overcoming these difficulties necessitates concerted efforts and policies from a variety of sources.

Furthermore, monies should be devoted toward high-efficiency social housing, worker housing, and inexpensive commercial housing developments. A careful examination of the conditions that enable real estate firms and persons and organizations buying or transferring real estate, as well as providing access to finance in accordance with legislation, is required.

Financial institutions and investors must examine current real estate developments and handle obstacles and concerns for each project. Customers should proactively disclose legal procedural difficulties to appropriate authorities for settlement, guaranteeing the implementation of signed credit agreements with real estate enterprises and purchasers.

Accelerating business restructuring

To increase liquidity in the real estate market, financial institutions should consider lending to developers, construction contractors, homebuyers, and construction material suppliers, as well as monitor the purpose of customers' loan use on a regular basis, actively collecting debts to increase capital turnover.

For financing to homeowners and real demand-oriented commercial operations, close collaboration with developers within the same project is required. To avoid the buildup of significant quantities of money in this market, strict credit management is essential.

Real estate firms must proactively reorganize, examining items appropriate for the market and actual homebuyers, and be prepared to sell, transfer, or even accept price reductions for projects that do not fit with their financial capacity or the majority of customers' wants. They must maintain financial control in order to take necessary actions and improve risk management quality.

The government published Decree 08/2023/ND on March 5, 2023, regarding revisions and additions to certain sections of decrees governing private corporate bond auctions and transactions in the local market, as well as the issuing of corporate bonds on the foreign market. This gives businesses time to restructure and seek capital while also providing a legal foundation to reassure investors.

Allowing firms to postpone or reschedule bond payment requirements necessitates bondholder understanding and cooperation. However, state management agencies have a role in regulating the debt settlement process to minimize difficulties and ensuring bondholder obligations are met.

Local governments should assist real estate companies in resolving procedural, legal, and regulatory issues that arise during project execution, such as investment plans and comprehensive planning permission.

Finally, the National Assembly and the government must instruct relevant authorities to evaluate and update legislative documents that are generating difficulties for real estate enterprises, resulting in significant adjustments that can restore and sustainably grow the real estate market.

The government should direct relevant agencies to speed up the restructuring process, correct supply and demand mismatches quickly, and effectively streamline wasteful real estate enterprises. These efforts are critical for restoring investor trust and allowing the real estate market to stabilize and grow in a sustainable manner.