Ministry of Construction leaders explain the reasons for high housing prices

On the afternoon of October 7, at the regular press conference of the Government, answering the question about the sudden and virtual increase in housing prices in some big cities, even though the transaction market is not really active, Deputy Minister of Construction Nguyen Viet Hung said that there are three reasons leading to the high housing prices. Among them are the imbalance between supply and demand, price inflation, pushing prices up, such as in the past, there were auctions, pushing up prices and then canceling deposits as reported by the press. In addition, there is also the reason due to high input costs.

According to Mr. Hung, there are many legal provisions prohibiting market manipulation and price inflation. In particular, the Penal Code, the Land Law, and especially the 2023 Law on Real Estate Business have very clear provisions on prohibited acts in real estate business.

“The Law on Real Estate Business has set out clearer and stronger provisions in controlling price inflation and manipulation of the real estate market,” said Mr. Hung.

To promptly rectify the current situation of abandoning deposits in land use rights auctions, the Prime Minister has issued an official dispatch with specific requirements and tasks for the Ministry of Natural Resources and Environment, the Ministry of Construction, the People's Committees of provinces and related agencies.

Mr. Hung said that, implementing the Prime Minister's direction, the Ministry of Construction has issued a document on "analyzing the cost structure, selling price, reasons for increasing real estate prices and proposing a number of solutions to reduce housing and land prices and stabilize the real estate market".

Propose to issue appropriate tax collection policy

At the same time, the Ministry of Construction also issued a document to strengthen the management and control of real estate price fluctuations to the People's Committees of provinces and cities.

In particular, the Ministry of Construction has proposed solutions, as well as recommended ministries, branches, provinces and cities to implement a number of specific tasks and solutions.

First, we must seriously and effectively carry out the tasks in the Prime Minister's dispatch.

At the same time, localities need to strengthen inspection and supervision of the implementation of legal regulations related to projects, investors, and brokerage units with price inflation and profiteering; take measures to prevent and handle violations (if any).

The Ministry of Construction also proposed to continue to speed up the progress of administrative procedures on investment, site clearance, land use fee determination, etc. to ensure supply for the market, to balance supply and demand in some big cities, especially in Hanoi and Ho Chi Minh City.

Along with that, provinces and cities must regularly organize the announcement and publicization of information about the real estate market, programs and plans for urban and housing development, and approved real estate projects.

According to Mr. Hung, this is to meet the conditions for capital mobilization according to legal regulations, to ensure transparency of market information, and to prevent fraud and scams in real estate business.

In addition, the Ministry of Construction also coordinated with the Ministry of Natural Resources and Environment and related ministries and branches to study and propose to competent authorities to consider and pilot the model of "Real estate transaction center and land use rights transaction managed by the State", in order to limit price and legal risks for buyers.

The Ministry of Construction requested the Ministry of Finance to study and advise competent authorities to issue appropriate tax collection policies to limit the situation of houses and lands that have been bought and sold but are abandoned and not used, causing waste of social resources.