Credit
supply at affordable lending rates is considered a necessary measure to
stimulate the property market, but beyond capital supply, the market also needs
a liberal environment with improper regulations removed, experts said.
While housing products being developed can easily
change hands, trade of completed apartments is being restricted by current
regulations.
Property developers have been complaining about
Circular 16/2010/TT-BXD providing guidelines for Decree 71/2010/ND-CP, which
allows buyers of unfinished housing products to freely transfer their
properties to other parties, while those already receiving completed houses
find it difficult to do so.
Once the properties were handed over to them, buyers
need home ownership certificates so that their apartments can change hands. The
point is it often takes a couple of years for homeowners to get such
certificates.
“Homebuyers are not to blame for late home ownership
certificate granting. The responsibility falls on property developers and the
State agencies,” said Le Hoang Chau, chairman of the HCM City Real Estate
Association (HoREA).
The fact that the property transfer is restricted
goes against property rights of citizens, damaging the interests of homeowners
and secondary investors in need of housing transfer, as well as affecting the
market liquidity.
Sharing this view, Nguyen Phung Thieu, general
director of Saigon-Gia Dinh Real Estate JSC, said such a policy is unreasonable
and should be removed soon, in order to enable apartments to change hands with
no need to have home ownership certificates.
Relieving
burden on input
Housing prices are now too high compared to people’s
incomes. Apart from speculation, difficulties in project development are also
ascribed to exorbitant property prices.
Property product prices are dependent on many
factors, especially site clearance cost, land use fee, capital cost, material
expenses, and possibly high management cost caused by prolonged administrative
procedures.
At a recent seminar held by HoREA, Nguyen Xuan
Quang, general director of Nam Long Investment Corporation, shared his
experience of being tortured by cumbersome procedures.
In 2008, Nam Long cooperated with a foreign partner
to carry out a project. After signing the contract, the two parties conducted
regulatory procedures such as seeking approval for project planning and
applying for an investment certificate.
The procedures were expected to last one year, but
in fact, it took three years for the project owners to complete all the
procedures.
When the partner decided to join in the project, the
local realty market was thriving. However, as the market worsens, the foreign
investor has pulled out of the project, leaving his company with huge expenses
and the possibility of project revocation due to slow deployment, Quang
stressed.
Another headache is land use fee calculated on
market prices under Decree 69. With this calculation, property developers have
to pay both site clearance compensation and land use fee in accordance with the
market prices, meaning double land purchase.
Therefore, many real estate enterprises are afraid
of executing their projects. As a result, the market comes to a deadlock and
tax agencies have difficulty collecting land use fee.
Property firms said land use fee would end up
pushing up home prices, and homebuyers will suffer.
Saigon Times
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