Vietnam needs 1.3m sqm of new housing till 2020

Up to 2010, urban areas will need about 438 million square metres to meet the housing demand according to the housing standard of 15 sqm per person, and 720 million sqm by 2020.

 

According to the assessment of Ministry of Construction, all cities have 50 percent of firm housing area and the ratio is 20 percent in rural areas. From now to 2020, the country would need 1.3 billion square metres of new housing equalling to over 16 million houses to replace temporary houses under Decision No 76/2004/QD-TTg.

 

The specialist group of US Institute of Communications Research and Vietnam Report said that Vietnam’s housing demand for now and future is very high with an aim to improve the living conditions of residents in both urban and rural areas.

 

Survey results of Hanoi Economic and Social Institute in 2006 showed that while the average income of Hanoian is about 15 million dong per person a year, the housing price averages at 300 million dong per 45-sqm house. Thus, the housing price is higher 20 times than personal income.

 

Vietnam Report warned that the movements of Vietnam’s real estate market could come into a very dangerous limit that real estate investors and speculators could lose the debt payment capacity. The ratio of money amount that medium class family must pay house loans per month and their total salary (after being deducted taxes) in Vietnam stands at too high level at this time. In line with international norms, the ratio should be at one third meaning that out of total monthly salaries of each family, 33 percent should be used to pay house loans. Meanwhile, in Vietnam, the saving for housing purchase accounts for 80 percent of income of a medium class household, the report remarked.