Hanoi addresses legal issues for social housing projects

The Hanoi Times — Hanoi is taking proactive steps to remove obstacles and achieve the prime minister's targets for social housing development in the capital.

Under the Decision No. 444/QĐ-TTg issued recently, the prime minister stated that  localities must incorporate social housing targets into their socio-economic development plans. Hanoi has been tasked with completing 44,866 units by 2030, out of a nationwide target of at least one million social housing units for low-income earners and industrial workers between 2021 and 2030.

The capital is expected to complete 4,670 units in 2025, followed by 5,420 in 2026, and 6,400 in 2027.

Legal issues

The Urban Infrastructure Development Investment Corporation (UDIC) has launched a social housing project in Ha Dinh New Urban Area in Thanh Xuan District, reducing its construction timeline from 36 months to 24 months. However, UDIC General Director Nguyen Van Luyen said challenges remain, particularly the limited and uneven allocation of land for social housing.

The government currently caps developer profits on social housing projects at 10%, but rising costs of materials, labor, and construction continue to put financial pressure on investors.

In response, UDIC has called for significant policy reforms to facilitate social housing development. The company proposes allowing direct land allocation for such projects without competitive bidding, particularly for experienced state-owned enterprises.

Moreover, UDIC suggests a pilot social housing development fund or equivalent financial mechanism to ensure long-term, sustainable investments. Another key recommendation is to apply special regulatory frameworks under the Law on Local Government Organization and the amended Capital Law to give Hanoi greater autonomy in managing and accelerating social housing projects.

During a national online conference on March 6 to address bottlenecks and promote social housing development, Deputy Chairman of the Hanoi People's Committee Duong Duc Tuan outlined key proposals to streamline the process.

He suggested that 1:500 scale urban development plans should be used as the primary basis for selecting investors and approving projects.

Tuan said once an urban development boundary is defined, authorities should allow immediate site clearance and investment without requiring lengthy approval procedures or waiting for investors to be selected through tenders. He also called for further administrative reforms, recommending that the approval process for social housing investment projects be shortened by three to six months to ensure timely implementation and efficient allocation of resources.

Major projects underway

In keeping with these directives, on March 3, a joint venture between the Hanoi Housing Development and Investment Corporation (Handico) and Viglacera Corporation - JSC broke ground on Hanoi's largest social housing project to date. Located in the Kim Chung New Urban Area (Dong Anh District), the development will provide 1,104 apartments on the CT3 plot.

In parallel, Handico is advancing the X2 Tran Phu mixed-use project in Hoang Mai District, which includes a social housing block. The 224-unit block is scheduled for completion in Q4 2026.

With 484 apartments already completed on the CT4 site of Kim Chung New Urban Area in 2021, Handico alone will contribute nearly 2,000 units - 20% of Hanoi's target for 2025-2026.

According to the Hanoi Department of Construction, in 2025 the city plans to finalize eight projects with a total of 4,670 units and start six new ones with approximately 10,220 units. In addition, six newly approved projects totaling 10,500 units will be added to the pipeline in coming years.

To achieve these ambitious goals, Hanoi Vice Chairman Duong Duc Tuan shared that the city is committed to focusing on comprehensive solutions, including strengthening decentralization, streamlining administrative procedures, and cutting red tape to facilitate private sector investment in social housing while ensuring accessibility for eligible residents.

Pham Tien Duc, General Director of Handico, highlighted the company's favorable conditions for implementing its projects, saying the firm is committed to completing the project in Dong Anh within 18 months. Under this timeline, the developer expects to begin sales in Q3 2025 and hand over the apartments one year later.