04/23/2008, 00.00
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80 percent of Vietnamese cannot afford to buy a home

Excessive prices, due in part to speculation, make purchasing impossible for most of the population. Profits on housing construction have reached 4-500 percent.

Hanoi (AsiaNews) - 80 percent of Vietnamese cannot own homes, because of the rise in housing prices that has taken place especially in the big cities, in part because of speculation.

The information has emerged from a meeting of economic experts held in the capital and covered by the quasi-official agency Vietnam News.

The experts have emphasised that in general it is considered a negative for the market if 30% of home owners have bought them for investments, and not to live in.  In Vietnam, the percentage could be double or triple this figure, according to Nguyen Quang, United Nations representative for human settlement.

The vice director of the Ha Noi Construction Corporation, Nguyen Truong Tien, instead emphasised the enormous profits being collected from the construction of homes, which have reached 4-500 percent, while a fair profit should run around 30 percent.  For example, the Hoang Anh River View project in Ho Chi Minh City cost about 53 million dollars and produced almost 312 million dollars, with a profit of more than 250 million dollars.

Quang says that UN estimates show that people in Vietnam should be able to buy a home for between 19,000 and 20,000 dollars, but there are no homes available at this price in the big cities.  The solution, in his opinion, must be found in higher taxation of real estate speculation, with the proceeds being invested in infrastructure for lower income people.

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See also
Crisis in China: 64 million empty apartments
Beijing, housing market collapses: down 50% in one year
Shanghai adopts new measures against real estate speculation
Chinese inflation remains high, economic growth slows
China to spend 1.3 trillion yuan to cool housing market


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