Housing saving fund project to be submitted to the government in April

Ministry of Construction will submit the project of housing saving fund to the government in April and start the pilot operation of the fund in Hanoi and HCM City by the end of 2012 or 2013.

The information was shared at the seminar in Hanoi on March 28 about general solutions for the property market in 2012 by Mr Nguyen Manh Ha, Head of Housing and Real Estate Market Management Department (under Ministry of Construction).

The project includes two modes. In the first mode, the Housing Saving and Development Fund enables low-income earners to borrow loans to buy houses and social houses, or supports enterprises to build low-cost housing and social housing plans. In the second mode, the fund will help those with stable income from medium and higher levels purchase houses.

Under it, the housing saving fund will be formed from the available capital of Housing Development Fund, savings of those demanding to join the fund, Central Funds, 30% profit from issuing state lottery and housing bonds. Capital mobilization interest rate for the fund will be equal to a half of commercial loan rate (estimated at 5% per annum); lending rate will be equivalent with deposit rate of the fund plus 1%.

Mr Ha explained that people will contribute capital to the saving fund on the basis of capital borrowing demand in future instead salary.

For example, if borrowing 500 million dong to buy a 50-square meter house, a person will have to pay 30% of total sum of money. After 4-5 years, they will be able to borrow another 70% of remaining sum and the loan will be paid within 10 years with fixed interest rate. - Source: Vietbiz24