Speed of old apartment replacement program slow

Hanoi has 1,579 old dormitories and apartment buildings which were built from 1960 to 1992, most of them have been seriously degraded.

Although the local government has posted a sign warning danger of the 5-story G6A building of Thanh Cong apartment complex in Hanoi’s Ba Dinh District recommending people limit   their move in the apartment complex, some people from households in the apartment complex still live on the first floor and even open shops. Resident Tran Van Long of building G6A said that his family has lived in the apartment complex for nearly 40 years.

For a long time, the building has been cracked and dangerously degraded, so many households have moved out, but his family still stays because they have not found a new, more suitable place to live, even though the government has repeatedly urged them to relocate.

Mr. Long explained that his family also wants to move to another place, but up to now, the investor has not made a commitment on the progress of renovating the house or the reasonable compensation level to make people in the apartment ensure that their interest is guaranteed.

Meanwhile, many households in the Nguyen Cong Tru dormitory area in Hai Ba Trung District which was built in the 1960s of the last century - are very happy that Hanoi City has a policy to demolish this dormitory to build new apartments. With a new apartment, people no longer have to live in cramped, damp and cracked apartments. However, families in the apartment have also been very worried about the renovation speed. If the renovation speed is slow, their lives and work will be disturbed.

The apartments are all located in good locations which are convenient for people to go to work or study. Therefore, investors of the degraded dormitory renovation projects in Hanoi must ensure appropriate compensation for households. For instance, although the project to renovate and rebuild the dormitory area of the Vietnam Film Documentation Institute at 22 Lieu Giai Street has an investor and a new construction plan, it could not be implemented for decades, because some families on the first floor doing business have requested a level of compensation equivalent to the market price.

According to the Hanoi Department of Construction, approximately 1,579 old apartment buildings are concentrated mainly in the 4 old inner-city districts, including 1,273 houses in 76 old apartment buildings and 306 independent old apartments. These old apartments have two to five floors with brick and concrete wall structures, panel floors or reinforced concrete frames.

Therefore, most apartments are degraded, especially some dangerous buildings on level D need to be renovated and demolished to build new ones. However, by early 2024, Hanoi has only completed renovating and rebuilding 19 old dormitories and apartment buildings, equal to 1.14 percent of the total workload. In particular, local administrations in many dangerously degraded housing areas have had decisions to approve the selection of investors and compensation plans for site clearance, but for many years they have not been able to carry out renovation.

Deputy Director Mac Dinh Minh of the Hanoi Department of Construction pointed out the culprits of the slow implementation of renovation and rebuilding of old apartments including planning work (building height, construction area), the K coefficient on compensation when renovating and rebuilding old apartments and investor selection.

Faced with this situation, Chairman of Hanoi People's Committee Tran Sy Thanh recently requested departments, agencies, and district people's committees where old apartment buildings and collective houses are located to urgently apply all measures to speed up implementation progress. The Hanoi Chairman assigned the Department of Construction to work on a draft and report to the Hanoi People's Committee on regulations on the K coefficient (the number of times by which land prices are multiplied to match market prices). Based on the Department of Construction’s K coefficient, district administrations and investors will negotiate compensation levels with residents in old apartments.

According to a representative of the Hanoi Department of Construction, the construction of the compensation coefficient is still carried out according to the provisions of Decree 61/2021/ND-CP, but the unit will base it on the locations of old apartments that need to be demolished and renovated to build a compensation coefficient consistent with reality while still keeping the balance of the projects’ financial efficiency.