Cheap housing shortage hits lower incomes

15:22' 13/10/2009 (GMT+7)

VietNamNet Bridge – Demand for low-cost housing has skyrocketed in major cities but supply is insufficient, according to a recent survey conducted by the Vietnam Report Joint-Stock Company.

For every 100 people who buy real estate, 40 per cent want to buy low-cost apartments, and 23 per cent want luxury apartments.

For every 100 people who buy real estate, 40 per cent want to buy low-cost apartments, and 23 per cent want luxury apartments, according to the report.

The Ha Noi and HCM City People's Committees said developers in those cities were required to either set aside 20 per cent of their land or 20 per cent of their apartment buildings for low-income families.

Millions of people are eligible to buy low-cost housing, but a shortage of land is hindering development.

Pham Sy Liem, vice chairman of the Viet Nam Construction Association, said the high demand for low-cost housing was partly due to the overbuilding of luxury apartment buildings in recent years.

Families with below-average incomes were priced out of the market, he said.

Adding to the problem is the shortage of low-income housing, which drives the price up even higher.

The UN Human Settlement Programme said it had estimated that 9 million out of 26 million people in Viet Nam's cities were living in slums.

According to reports from provinces and cities nationwide submitted to the Ministry of Construction, 263 low-income housing projects will be completed by 2015.

They will provide 217,230 apartments with an area of nearly 11 million square metres that can accommodate 870,000 people.

VietNamNet/Viet Nam News