Concessional loan for​ individuals building or renovating, repairing houses by themselves in Vietnam

Concessional loan for​ individuals building or renovating, repairing houses by themselves in Vietnam (Image from the internet)

On July 26, 2024, the Government of Vietnam issued Decree 100/2024/ND-CP detailing certain provisions of the Housing Law 2023 on the development and management of social housing.

Concessional loan for​ individuals building or renovating, repairing houses by themselves

Individuals building or renovating, repairing houses by themselves in Vietnam who are eligible for social housing support policies to rent according to the provisions of Clause 4, Article 85 of the Housing Law 2023 are entitled to preferential loans under the following regulations:

(1) Conditions for borrowing funds

- Ability to repay the loan according to the commitment with the credit institution providing the loan;

- Possess a Certificate of land use rights, ownership of assets attached to the land for the housing project needing construction or renovation, repair;

- Have a capital use plan, a construction permit in cases where a construction permit is required according to the provisions of the construction law. Where there is a temporary construction permit according to the law, a loan suitable to the duration of the construction's existence may be considered;

- Ensure loan security by the value of the homestead land use rights and assets attached to the homestead land or other assets as prescribed by law.

(2) Loan amount: The maximum loan amount is 70% of the total project investment or the capital use plan and does not exceed 70% of the value of the loan security assets.

(3) Loan term: The maximum loan term is no more than 20 years from the day of the first loan disbursement.

(4) Loan interest rates:

- Preferential loan interest rates at the Social Policy Bank equal to the loan interest rates for subjects borrowing from the Social Policy Bank to buy, lease social housing as prescribed from time to time. Overdue debt interest is 130% of the loan interest rate;- Preferential loan interest rates at credit institutions are agreed upon by the credit institution and the customer.

(5) Individuals self-building or renovating, repairing housing for those eligible for social housing support policies to rent according to Clause 4, Article 85 of the Housing Law 2023 are entitled to preferential loans that meet the requirements of Clause (1) and must prepare an investment project. It is not permitted to trade social housing products in the form of buying and selling. During implementation, a report to the provincial housing management authority must be submitted every 3 months.

(Article 26 of Decree 100/2024/ND-CP)

Types and standards of social housing built by individuals for lease in Vietnam

The types and standards of social housing built by individuals for lease in Vietnam are regulated in Article 28 of Decree 100/2024/ND-CP as follows:

- In the case of multi-story housing with many apartments by individuals, the following regulations must be ensured:

+ For housing with 02 floors or more and with a scale of 20 apartments or more, the provisions of Clause 1, Article 57 of the Housing Law 2023 must be met;

+ For housing with 02 floors or more and with a scale of less than 20 apartments, the provisions of Clause 3, Article 57 of the Housing Law 2023 must be met.

- In the case of constructing a single-floor row housing for rent, the following regulations must be ensured:

+ Must be self-contained (private living room, private toilet) according to construction standards;

+ The average usable area per person must not be less than 8 m^2^ (excluding ancillary areas);

+ Must meet the construction quality standards from grade IV upwards according to construction law;

+ The layout of the housing construction site and other construction items in the single-floor row housing must ensure conditions of convenient traffic, environmental sanitation, and conditions for resolving emergencies (fire, explosion, building collapse...).

Nguyen Ngoc Que Anh

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