The Ha Noi Construction Department has just finished drafting plans for a low-income housing project, with apartments for sale and for lease between now and 2010. Though many people have welcomed the news, many more remain sceptical about what the project will actually mean for them. Less for less Dong Xa Living Quarters in Cau Giay District is the initial model for the low-income housing project in Ha Noi. After nearly 10 years of use, five blocks of four-storey apartments have fallen largely into disrepair. The housing was built for construction workers, bank staff, teachers and military personnel, but there remain no markets, schools or entertainment areas nearby. Even so, not long ago people were going to a lot of trouble to get one of the prized slots. Nguyen Thi Thom, a resident of the complex recalled the difficulties she went through to purchase her 40sq.m apartment. Her family was given priority for low-income housing because of her volunteer service during the American War. "Ten years ago, though the procedure for buying this type of apartment was not as complicated as it is now, I spent the whole year completing the application and other necessary paperwork," she said. Then, she had to wait another two years to be able to buy the apartment. When she finally moved in, there was neither electricity nor clean water. Tran Thi Nga, a retired teacher, complained that though her family had also been given priority for low-income housing, she was still ineligible to buy an apartment. "In order to actually get this apartment," she said, "I had to buy it from another owner." And when she finally moved in, she found that the 50sq.m space was divided into five tiny rooms, so poorly designed that she had to sink a great deal of money into renovations. "Many other residents have also had to renovate because of the bad design and poor quality," she said. Tough market "Supplying apartments for low-income people has been a serious problem," said Nguyen Minh Phong, PhD, from the Ha Noi Socio-Economic Research Institute. According to Phong, individuals in Viet Nam have, on average, 7sq.m of living space, but 30 percent of urban dwellers have only 4 sq.m each. Moreover, 60 percent of residential areas arc badly in need of renovations. The Japan International Co-operation Agency said before the city was expanded that Ha Noi was experiencing a severe housing shortage, lacking 7 million sq.m of space or 120,000 necessary apartments. And around 70 percent of the city's households have an income level below VND10 million (US$600) per year. A Natural Resources-Environment and Real Estate Department report for the period of 2006-07 stated that Ha Noi needed around 7,700 apartments to house people displaced by new city projects alone, though there were only around 5,000 available. "There would be 500 apartments for lease and 400 for sale in Viet Hung new urban area in Long Bien District and Nghia Do Living Quarters in Cau Giay District. They would be operational in 2010, but would be able to meet only one sixth of demand," Phong said. Because demand was far exceeding supply, instances of corruption had grown more common, he said. He added that though low-income housing was most appropriate (given pricing, payment methods and other factors) for State workers, the present income of State staff was insufficient for a VND300-400 million ($17,964-23,952) apartment. He estimated that a university graduate had an income of around VND2.5 million ($150) per month. Given this figure, a couple would have to not spend any money for 10 solid years to save enough to afford a low-income apartment. But hey, it's cheap Tran Viet Son, deputy director of Song Da 206 Joint Stock Company, said that investing in building cheap apartments was not costly because the State would fund necessary infrastructure development, and investors needed only to pay building fees. With sale prices at VND4 million per sq.m, enterprises stood to turn a profit, he said. However, complex procedures and long waiting periods for permits had discouraged many from investing in low-income housing. Moreover, the regulation stating that residential buildings be no higher than 6 storeys with apartments no smaller than 45sq.m did limit the profits investors could gain from any given space of land. In HCM City, only a few enterprises had invested in low-income housing, and even so, they were charging VND7-8 million ($419-479) per sq.m, he said. Ultimately, he commented, it was the State's job to make housing project construction easier for investors and to ensure affordable and accessible housing existed for low-income people.
Source: Vietnam News
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