The HCMC Real Estate Association has proposed the central bank allow real estate businesses to restructure debts due in 1-2 years and to access new loans with collateral.
One of the biggest challenges facing real estate firms is the possibility of their due debts being classified as bad debts, which would mean they could not access new loans, even though they have feasible projects and secured assets, according to the proposal.
Furthermore, those who have an actual demand for housing to live in are also finding it difficult to access bank loans.
For these reasons, the association has proposed the State Bank of Vietnam issue a new circular on allowing real estate businesses to restructure loans due in 12-24 months, to retain them in the current debt group, and not move them to the bad debt group, and get new loans with collateral.
The association’s chairman, Le Hoang Chau, told VnExpress that as of early February, credit-related difficulties and obstacles facing real estate firms and homebuyers had become bigger.
According to Chau, 2022 was a year of extreme difficulties and 2023 will be a decisive year for real estate businesses.
He cited a report of the General Statistics Office showing that nearly 1,200 real estate firms were dissolved in 2022, up 38.7% against 2021.
Difficulties in the real estate sector will have a knock-on effect on many other sectors, and affect housing security for disadvantaged people in society, he said.
From the end of 2022 to the beginning of 2023, real estate businesses have restructured their investments, changed their business plans, and had to stop or postpone investments, project implementation and initial public offerings.
Many enterprises have had to shrink production, or sell projects but have yet to find buyers, leading to layoffs and salary reductions, with some halving the number of their employees and cutting salaries by 30%-50%.
Even real estate businesses with large total assets, which have lowered selling prices and increased discounts to 45-50%, are still finding it hard to sell properties.
“If the credit bottleneck is resolved in time in 2023, it will help stabilize the real estate market and benefit the sustainable development of the whole banking system,” Chau said.
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