The basic human right is to have a suitable and safe accommodation. This legitimate housing demand is necessary conditions to improve the quality of human resources as part of Vietnam's industrialization and modernization

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A QUALITY STUDY OF SOCIAL HOUSING PROJECTS
IN HO CHI MINH CITY: REALITY AND SOLUTIONS
NAME: TRAN QUOC TUAN
SUMMARY OF MASTER THESIS
A Thesis Submitted to UOHH in
Fulfilment of the Requirements for the
Degree of MBA

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CHAPTER I. INTRODUCTION TO THE STUDY
1.1 Background of the study
Housing provides "basic foundation" to help people live and maintain social
activities and physical activity (Byrne and Diamond, 2007). The real estate market has
become unstable since the economies of many countries flourished after World War II.
Housing has become "expensive" in many countries since the beginning of the 21st
century (Haffner and Boumeester, 2010). There is a gap between high-income and low-
income groups. For the low-income group, owning a comfortable home becomes one of
the dreams beyond their pay.
In all countries of the world, human development is always accompanied by urban
development. Urbanization comes from human activities, gathered from activities to
distribute food, vegetation, and infrastructure to create a better environment for human
life. Moreover, the investment in housing expansion is a symbol of urban development
because housing is the essential foundation for social and economic development for all
people (Byrne and Diamond, 2007) ...
With the rapid growth of cities, more and more people are moving to these urban
areas and the consequence of this migration process is the increase in population in cities.
Housing is one of the basic needs of human life, equally important to the role of food,
housing provides private and safe residence for people (Sheng and Mehta, 2008). As the
number of people living in the city becomes crowded and competitive, housing demand
will increase, then the gap between demand and home supply will widen if the pace of
construction is slower than demand growth. Young households and low-income
households have lower competitiveness and may be able to become homeless because
they have difficulty entering the housing market. If the situation of homeless households
worsens, urban development cannot continue to be stable.
In order to keep the stability and sustainable development of the city, the
government must take measures to help young families and low-income families enter
the housing market. Sheng and Mehta point out that home ownership is a "human right";
no government can ignore this important right of citizens (Sheng and Mehta, 2008).
In Vietnam, the objectives of housing policy are based on the first Housing Law of

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1991, which stipulates that all Vietnamese citizens have legal and legitimate rights to buy
houses. This statement is reaffirmed in the 2011 National Housing Development Strategy,
which states: "The basic human right is to have a suitable and safe accommodation. This
legitimate housing demand is necessary conditions to improve the quality of human
resources as part of Vietnam's industrialization and modernization. "
Vietnam is in the stage of integration and development, urbanization is increasing
rapidly, leading to a clear differentiation between the poor and the rich in urban areas.
Low-income urban residents are confronted with the problem of lack of housing or in
shabby, cramped and overcrowded residential areas because they have no economic
capacity to improve themselves his stay. Therefore, finding a synchronous solution on
policy, design and construction of residential areas, social housing for low-income people
is currently one of the important issues in Vietnamese cities.
1.2 Statement of problems
“Housing and all services are basic human rights, Governments are obliged to
make sure everyone has it, it starts with direct support for people with little opportunity.
most, through programs that guide self-promotion and community action” (Housing
Citation for the Poor in Asia, 2010).
The home provides "basic foundation" to help people live and maintain social
activities and physical activity (Byrne and Diamond, 2007). Real estate market prices
have become unstable since the economies of many countries flourished after World War
II. Housing has become "expensive" in many countries since the beginning of the 21st
century (Haffner and Boumeester, 2010). There is a clear gap between high-income and
low-income groups. For the low-income group, owning a comfortable home becomes
one of those dreams beyond their pay.
In order to ensure the lives of people in Ho Chi Minh City, to help low-income
people to stabilize their lives, social housing programs have prioritized to meet the
housing needs for income-strata populations. low. The number of social housing has
increased significantly in both construction floor area and number of apartments. In 2018,
the whole city built 44,701 social apartments. The results of social housing development
have shown great efforts of the Ho Chi Minh City government. However, compared to
the development targets and quality of houses under Ho Chi Minh City's Social Housing

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Development Program approved by the Prime Minister, the target has not yet been
reached.
To examine the social housing quality through various kinds of social housing
project provision in Ho Chi Minh City, including: State investors, private investors and
20% conversion of commercial housing projects., this study tries to find out factors
influencing on the quality of social housing project in Ho Chi Minh City, then making
recommendations to improve it. It is evaluated based on the following factors:
- Investment cost
- Dwell selling price
- Building codes and standards
- Project manager issues
- Boosting policy by goverment
1.3 Objective of the study
- Research object: Social housing development in Ho Chi Minh City area.
- Scope of research on content: The thesis focuses on researching content of social
housing development including problems
(i) Evaluating social housing development, social housing development plans in Ho
Chi Minh City;
(ii) Ho Chi Minh city’s land fund for social housing development.;
(iii) Evaluate policies and activities of managing, trading and leasing social
houses in Ho Chi Minh City.;
(iv) Criteria for evaluating social housing development results. Researching factors
affecting the development and quality of social housing.
1.4 Research question
The specific research questions are reported below:
- What are factors influencing on the quality of social housing project in Ho Chi

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Minh City?
- Assessing the quality of social housing projects in Ho Chi Minh City?
- How are social housing development policies in Ho Chi Minh City?
- What are recommendations to improve the quality of social housing project in Ho
Chi Minh City?
1.5 Significance of the study
To evaluate Social housing project quality, this study aims to propose a proper
dimension of Social housing project by 3 provision domains, then, it contributes to give
Ho Chi Minh city developers more attention to Social housing as well as assisting them
recommendations to improve the quality of Social housing project.
1.6 Scope of limitation
- Space limit: Research is conducted in Ho Chi Minh City
- Time limit: The study was conducted from January 2015 to December 2018
Content limitation: The study only focuses on issues surrounding social housing in
- Ho Chi Minh city
1.7 Organization of Remaining Chapters
This study divides into six chapters.
Chapter I: The chapter provides an overview of the background of the study,
problem statement, purpose of the study, significance of the study, research questions,
and assumptions of the study. The chapter ends with various term definitions.
Chapter II: This chapter includes an overview of social housing, project quality,
social housing project quality with sub-items. This follow with the review of the sub-
items practices, important to measure a social housing project quality. In addition, this
chapter also discusses the empirical studies of support items to clarify social housing
project quality. Finally, it ends with the hypotheses, conceptual framework of this study
and conclusion of this chapter.
Chapter III: This chapter describes the selection of subjects, data collection, and
respondents’ profile.
Chapter IV: This chapter reports the analysis of the data in detail starting from the
preliminary examination of data until the results of the analysis. Together, it presents the

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profiles of the respondents, goodness of measures and descriptive statistics of the
respondents. It follows with the findings or results of the study. These findings include
descriptive analysis of all the independent and dependent variables, reliability, validity,
confirmatory factor analysis and structural equation modeling analysis.
Chapter V: This chapter discusses the recapitulation of the study’ findings and,
provides interpretation related to the research hypotheses. The chapter ends with the
review of the findings.
Chapter VI: Lastly, this final chapter provides summarization of the study.
Discussion includes conclusions related to the research hypotheses, contribution and
implications of the study, limitations, and the recommendation for future research.
CHAPTER II. LITERATURE REVIEW, HYPOTHESES AND
CONCEPTUAL FRAMEWORK
2.1 Social housing
2.1.1. Social housing concept
Social housing is the term for houses and buildings. They are built by the
government to address the need for accommodation of low-income, poor, economically
disadvantaged or difficult housing providers. The government will build, lease or sell
these objects at preferential prices. Policies, plans and programs for low-income housing
development are often run by local governments such as district or city governments.
The study proposes the concept of social housing in Vietnam: "Social housing is a
type of housing for poor families who have low average income. They are hired or
purchased at preferential prices., They must meet some specific conditions prescribed by
the city government, comply with the regulations and laws”.
2.1.2. Characteristics of social housing
According to Iglesias (2006), Housing for social people is often cheaper than other
types of houses because of the following reasons:
(1) this type of house is not bad in quality as many people think, still ensuring
sustainability with basic construction standards, only it does not use expensive
equipment, such as those low-rise houses (less than 9 floors), no elevators, no high-end

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sanitary equipment, no fancy decorative motifs, no luxury utility services such as
swimming pools, tennis courts ...
(2) Smaller area than high-end apartments, in many cases several apartments share
a kitchen and toilet.
(3) The Government reduced or exempted some investor taxes such as land tax. In
addition, the Government also provides financial support through interventions to get
bank loans with low interest rates, support part of the compensation for clearance, and
financial support through intervention. reducing prices of construction materials ...;
(4) The buyer is entitled to a discount on the price of the apartment, sometimes
only by the price of the apartment and gradually paid in 15 - 20 years without interest or
very low interest. In order for investors to be disadvantaged, the government often
prioritizes them with some other more profitable projects to compensate for. Buyers may
have legal ownership.
2.1.3. Beneficiaries of social housing
The analysis also shows that the concept of social housing beneficiaries is a
complex, synthetic socio-economic and demographic category in many ways. From the
author's point of view in this thesis: The beneficiaries of social housing are those with
low income (and accumulation level) below the average, not subject to regular income
tax under the provisions of personal income tax law; There are difficulties in housing
(there is no house owned by them, not yet bought, rented or hired to buy social housing
for beneficiaries of social houses, not yet entitled to housing support policies, residential
land in any form at the place where they live or have their own houses but the average
housing area per capita in the household is lower than the minimum housing area
prescribed by the Government from time to time. and each region), needing support on
mechanisms and policies to access housing market in a special way.
2.2 Social housing project
2.2.1. Construction project concept
2.2.2. Characteristics of social housing construction project
The management of a social housing project (in a state of always changing) will be
more complicated than the production processes (in a stable state) of manufacturing

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companies. It comes from the following reasons:
- Social housing investment projects often need a large amount of money, many
people from different departments in the organization and sometimes they have to work
overtime or hire from other companies.
- Human resources do not master the content of work, will lose the jail time and the
cost of social housing projects.
2.2.3. Requirements on social housing projects
In addition to the low cost of rent / purchase, social housing projects must also
ensure sustainability / maintenance costs and low regular operation. Social housing must
ensure sustainability with basic construction standards, maintenance costs, regular
operation should be specifically and accurately notified, minimizing unnecessary
services ... also must be consistent with their workplace (Hancock, K. E (1993)).
2.3 Social housing project quality
2.3.1. Structural sustainability
There are a number of tools for assessing the sustainability of structures:
Assessment tools include criteria for efficient use of energy, water and natural resources
(Haffner, M., & Boumeester, H. (2010)). It aims to minimize environmental impacts,
enhance social housing quality, and enhance capacity. responding to disasters, climate
change, helping raise public awareness about sustainable development, integrating
sustainable infrastructure development and social housing ... Sustainable criteria can be
quantified under The form of specific and scientific parameters is the basis for
determining whether a social housing project is sustainable or not no and its
sustainability
Standards (engineering, environmental technology and construction) can
implement the design and construction of sustainable housing for low-income people, the
most difficult comes from the socio-economic aspect rather than technical (Hancock, K.
E (1993)).
One of the main goals of sustainable design of social housing is economic
efficiency. The total cost of social housing projects (the construction, operation, and later
stages of destruction) according to sustainable design criteria, they are always lower

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while the conditions of environmental quality and comfort works are guaranteed. Initial
investment costs may be higher than conventional designs. It means that the price of
sustainable social housing will be higher (Hulchanski, J. D (1995)).
2.3.2. Usability
Usability of social housing is an important factor affecting the satisfaction of
residents. It is the physical characteristics of the house (kitchen space, laundry area,
living and dining area), the geometry of the lobby area, the number and density of
sockets, the number of rooms. sleep and bathroom, other aspects of the house such as
home quality, privacy (living density), and family support services provided by investors
such as waste disposal, security, lighting light and ventilation system of the house
(quoted from Tan, 2011).
2.3.3. Amenities service accessibility
The satisfaction of the population is not only based on the characteristics of social
housing, the ability to access services also plays an important role in determining the level
of satisfaction in the quality of social housing projects ( Noriza et al., 2010) and (Salleh,
2009).
2.3.4. Infrastructure provision
The quality of social housing projects is evaluated based on the following criteria
(Morris et al. (1976)):
- Area to stay.
- Access to quality schools.
- Construction quality of roads and traffic.
Uniformity of social class, race, and moral group
2.4. Investment cost
2.4.1. Land cost
Government handover land: The Government is based on the purpose of activities
of organizations and individuals. They will conduct land allocation with collection of
money or allocation of land without collection.
Land lease: The Government leases land, they will collect land rental annually.
Land transfer: This is a deserted land fund and adjusted for reasonable purposes.

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2.4.2. Administration cost
- Administration cost of social housing will be paid monthly or periodically by
owners and users of social housing. After that, the operational management unit will fully
perform the work in accordance with provisions in paragraph 1, Article 10 of the
regulation.
- Administration cost of social housing will be calculated based on the price list of
operation management services specified in Article 30.
- The area of using social housing or other areas other than apartments in social
housing will be used as a basis for calculating operation management funding.
2.4.3. Building cost
Building costs must be clear about charges, including:
- Security protection costs.
- Cleaning costs.
- Monthly technical maintenance costs.
- Cost of fire protection.
- The cost of repairing all damaged buildings.
2.4.4. Maintenance cost
For apartments, other areas in social houses where investors invest or lease,
investors must pay 2% of the value of apartments or other areas for sale or lease
purchase; This amount shall be calculated into the sale and rent-purchase money, which
must be paid by the purchaser and lessee upon hand-over and specified in the purchase
and sale contracts and hire-purchase contracts;
For apartments, other areas in social houses that investors keep not sold, not leased
or sold, have not been sold or rented until the time of handing over and putting social
houses into use., except for the area under common ownership, the investor must pay 2%
of the apartment value, the retained area; This value is calculated by selling the highest
priced apartment of that social housing.
2.5 Dweller selling price
2.5.1. Market demand

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Market demand is the most important factor of any business administrator. Before
managers make decisions on what products to produce, they need to calculate which
products they consume in the market and who they serve, need to capture information
about the number of customers in need, the level of customer income, the number of
products of the same type on the market and the volume of each supplier's products on
the market.
2.5.2. Ceiling price policy
2.5.2.1. Ceiling price policy projects using government capital
2.5.2.2. Social housing ceiling policy built by investors
2.5.3. Location
The selection of social housing construction sites needs to be calculated in
accordance with the city development orientation. It is shown in the land use planning of
each locality, with the master plan for socio-economic development, transport
development planning.
2.5.4. Interest rate
Interest rates are an important government economic management tool. By
controlling the interest rate limits of the market, the government can influence all
economic sectors. Moreover, the government also uses different interest rates as a
stimulus for specific sectors depending on economic development priority policies.
2.6 Building code and standard
2.6.1. Parameter
2.6.1.1. Social housing area
2.6.1.2. Low-rise adjacent social housing
2.6.1.3. The project is built by an individual
2.6.2. Material
2.6.3. Technical system
2.6.4. Sanitary equipment
2.7. Project management issues
2.7.1. Design quality
Design changes often increase construction costs. Each request for additional

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changes will increase the cost of 1 km of roads by about US $ 5,000 (World Bank, 2004).
Meanwhile, requests for changes are made regularly in many social housing projects,
The design change averages 3 lovers on a contract
2.7.2. Construction capability
Construction of construction companies must be carried out according to design
documents. If the construction company is massively executing, it will accelerate the
progress but will not guarantee the proper technical process. If they encounter problems
that affect the quality of the entire social housing project, the contract may be suspended
or canceled.
2.7.3. Project manager capability
Planning. This is the stage of goal development, job identification, estimating the
resources needed to implement the project and the process of developing a unified,
logical, and actionable plan that can be represented in the form of system diagrams or
according to traditional planning methods.
Coordination of implementation. This is the process of distribution of resources
including capital, labor, equipment and especially important coordination and
management of time schedule. This stage details the time, scheduling for each job and
the entire project (when it starts, when it ends), on that basis, arranging appropriate
capital, human resources and equipment.
Monitoring is the process of monitoring and checking the progress of the project,
analyzing the implementation situation, reporting the current situation and proposing
measures to solve problems during the implementation process. Along with monitoring
activities, the evaluation of the project between the end of the period and the end of the
term is carried out in order to summarize the experience and propose the following
phases of the project.
2.7.4. Supervision capability
- Method of using timelines: Timeline of the project is events, used to mark a
process, a stage of the project. They can be recorded as graphs or words. This method is
understood by everyone in the project about the actual status of the project and can
manage and inspect the project.

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- Limit testing method: It will establish a limited scope for project management and
be used to monitor the expenditure and level of project implementation.
- S-curve: S-curve is often used for budget monitoring. This is a graph analysis
method to show the difference between planned expenditures and actual expenditures.
- Implementation control - obtained value diagram: It has a very important role, will
measure the implementation of the whole project.
2.8. Boosting policies from government
2.8.1. Access to funding endorsement of VND-30 trillion credit package
2.8.2. Decrease VAT and land tax
2.8.3. Easy administrative approval
2.8.4. Public infrastructure provision
2.9. Status of social housing in Vietnam
2.9.1. The role of social housing in Vietnam
2.9.2. Demand for social housing in Vietnam
2.9.3. Result
2.9.4. Reason
CHAPTER III METHODOLOGY
3.1. Research framework
The research will be based on an approach to assessing the quality of social
housing in Ho Chi Minh City, finding out the factors that make up the quality of social
housing projects. In particular, the quality of social housing is the result of five factors:
Project issues, boosting policy by government, building codes and standards, Dwell
selling price and Investment cost.

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Investment cost
- Land cost - Administration cost
- Building cost - Maintenance cost
Dwell selling price
- Market demand - Ceiling price policy
- Location - Interest rate
Building codes and standards
- Parameter - Material
- Technical system - Sanitary equipment
Project management issues
- Design quality - Construction capability
- PM capability - Supervision capability
Boosting policy by government
- Access to funding endorsement of VND-30
trillion credit package.
- Decrease VAT and land tax
- Easy administrative approval
- Public infrastructure provision
By State investors
By private investors
20% conversion from commercial
housing projects
Performance of Social Housing
project in HCMC
1. Structural sustainability
2. Usability
3. Amenities service accessibility
4. Infrastructure provision

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3.2. Research process
Determining research issues:
Improving the social housing project performance
in HCMC
Refer to published
studies: internet, library
...
Determine the factors
affecting the quality of
social housing projects
Expert opinion
Design preliminary questionnaire
Test survey, Consult experts
Design official questionnaires
Official survey
Analysis of collected data
- Solution
- Conclusion
- Request

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3.3. Research Methods
(1) Inheritance Method: The thesis will inherit the relevant published works
implemented in the country and abroad. Through the synthesis, analysis and comparison of
the quality assessment of social housing projects. The study will make recommendations to
improve the quality of social housing projects in Ho Chi Minh City
(2) Traditional research methods such as analysis, synthesis, comparison, target
trees, problem trees ... to approach the results of social housing construction in HCMC,
analysis of advantages and disadvantages in social housing development in HCMC, to find
out the policies and solutions to develop effectively and sustainably.
(3) Qualitative research method
The author has collected information from a number of different target groups
(4) Quantitative research methods
In order to collect materials for research, analysis, and the topic of primary and
secondary information collection.
(5) Expert consultation method: It is used in many stages, such as setting up
interview forms, directly exchanging opinions, asking for advice on policies, consulting for
research results reports, proposing solutions
3.4. Data collection.
3.4.1. Questionnaire design
The survey questionnaire is a tool used in survey studies. In the construction field,
the questionnaire is a tool to collect feedback from project participants such as investors,
consultants, construction contractors on construction project changes for to people living in
social housing projects. In addition, this method has the advantages of low implementation
costs, easy implementation, and can survey a large number of participants in a short time.
The questionnaire design process is as follows:

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Refer to published studies
Expert interview
Determine the content, questionnaire
components.
Questions with
appropriate content

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3.4.2. Determine sample size.
Before conducting a survey questionnaire, it is necessary to determine the number of
samples that need to be obtained. According to the empirical formula of Bollen (1989), the
number of research samples is 5 times the number of factors that are satisfactory. The
number of factors analyzed is 20 factors, deducing the minimum number of samples
required to achieve Bollen's experience is 300 samples.
3.4.3. Distribute and collect questionnaires.
Data collection is done by distributing the survey tables to the objects. These surveys
are of two types: paper surveys and survey files sent via email.
After collecting the questionnaire, conducting an examination and removing invalid
answer sheets (the answer is missing, the answer has many results).
3.5. Process of data analysis
From the data collected, conduct statistical analysis describing the components
answering the questionnaire to get an overview of survey data. Next use the Cronbach’s
Alpha coefficient to check the reliability of the scale in the survey. One-way ANOVA tests
or Kruskal-Wallis, Spearman correlation coefficients to assess the level of occurrence and
influence of the factors. Finally, using the Principal Component Analysis method to group
elements that have a large impact on the level of investment.
3.6. Analysis tools.
Use the Cronbach’s Alpha coefficient to check the scale reliability of the variables
One - way ANOVA analysis (1 - factor variance analysis) or Kruskal - Wallis to
assess whether or not the difference in average value between groups answers in questions
Spearman rank correlation coefficients are used to determine whether the consensus
among groups responds to the rating of the degree of occurrence and the degree of influence
of the causes.
Pearson correlation coefficient is used to evaluate the correlation between the level of
occurrence and the degree of influence
Principal Component Analysis technique with Varimax rotation to group related

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variables into one factor
SPSS 16.0 and Microsoft Excel software are used to process collected data

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CHAPTER 4
RESEACH RESUILTS
4.1. Overview of Ho Chi Minh City
4.1.1. Geographical location
4.1.2. Topographic
4.1.3. Population
4.1.4. Social housing development in Ho Chi Minh City
Ho Chi Minh City had a spontaneous housing development process, lack of planning
for many years. Along with the process of urbanization and population growth, social
infrastructure and technology do not well meet the needs of the people. The proportion of
trees, parks and public spaces has been limited, and rivers are spontaneously encroached by
families, they have created slums that affect social order. for a long time (Lưu Trọng Hải,
2017).
Nearly 480,000 households without houses are the number published by Ho Chi Minh
City Department of Construction through a survey on the housing situation of people in Ho
Chi Minh City (figures up to 1/2018). The exact number of the survey of households who
have no house or living with their parents or relatives is 476,158, accounting for 23.46%.
In which, there are about 20,000 households, officials and employees who have not had
a house or are living with their parents and relatives and need to improve housing quality.
Currently, there are about 13,000 displaced households in urban projects in Ho Chi
Minh City. In addition, there are about 300,000 households in Ho Chi Minh City
corresponding to 1.2 million immigrants wishing to rent social housing. In it, nearly 143,000
low-income households
4.2. Investing in social housing projects in HCM
4.2.1. By State investors
Project to build social housing for low-income families
The project of building social houses to move people from the inner city to the suburbs
The project to build houses for urban people and the project to build houses for
suburban farmers in exchange for agricultural products. This project is implemented in the
following way:
Firstly, the City Housing Development Company and the district have built more than
3,400 houses with pre-paid deposits of the people. This method is limited because only

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people with capital can contribute money in advance to have a home.
Secondly, in suburban districts, the government provides major construction materials,
farmers can pay their contributions with agricultural and marine products, resulting in 300
houses built by this method.
4.2.2. By private investors
The models of social housing projects invested by private investors are as follows:
Model 1: Companies with land funds, they will mobilize employees, those who have
no houses, contribute capital to set up projects to build social housing... These companies
have built 1,200 apartments with 72,000 m2 of use floor and a total cost of VND 288 billion.
Model 2: Companies will invest in building new residential areas, With this model,
companies have built 1,800 apartments with a total investment cost of VND 760 billion.
Model 3: Investors will take the profits from home business to offset construction costs
to lower the cost of apartments..
Model 4: Mobilize capital from many sources in society: the project investor is allowed
to remove part of the company's capital (about 20-30%), the employees will contribute the
rest to the investor. , the contribution amount is divided into several phases according to the
progress of the project
4.2.3. 20% conversion from commercial
In 2018, HCMC received registration of 60 projects to convert from commercial houses
to social houses, with a scale of about 38,800 apartments; 74 projects registered to adjust the
area structure with the initial number of apartments of 33,800 units to 44,800 units
4.3. Investment cost
4.3.1. Land cost
Since 2016, Ho Chi Minh City has completed 7,974 social housing apartments.
Currently, there are 12 social housing projects under construction with a scale of 10,191
apartments and 4 projects are about to start with 2,216 apartments
Based on the decisions of the Prime Minister's general planning: zoning planning,
detailed planning and new rural construction planning. Ho Chi Minh City has arranged a land
fund for social housing development in various forms (using 20% land fund to allocate land
fund according to zoning plan, detailed planning and land fund location right at the offices).
industrial parks for workers' houses and campuses of universities and colleges for student
dormitories, ...). So far, HCMC has 86 projects for social housing development with about

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1,735,000m2 of land. HCMC has completed 100 social housing development projects for
industrial park workers with a scale of about 41,000 apartments, total construction floor area
of about 2,050,000m2.
4.3.2. Management costs
Ho Chi Minh City has issued a decision on the price frame for social housing
management and use services in the city: Social housing does not have an elevator; the
minimum level is 500 VND / m2 / month; the maximum is 3,000 VND / m2 / month. Social
housing houses have elevators; the minimum level is 1,500 VND / m2 / month; the maximum
is VND 6,000 / m2 / month.
This price frame is applied to the collection of state-owned social housing management
and operation fees in Ho Chi Minh City according to Article 106 of the Housing Law.
Prices of social housing operation management services do not include maintenance
costs of common ownership, car keeping costs, fuel, energy, domestic water, television and
communication costs. Contact information and other service charges for the sole use of the
owner, the user of social housing.
4.3.3. Construction costs
Investors are allowed to mobilize construction costs with domestic and foreign capital
sources. Many investors have access to loans from foreign credit institutions, most notably
the Asian Development Bank. This bank has implemented a financial support program for the
Government of Vietnam to promote the program for the purchase of social housing loans
since 2005. Accordingly, through the State Bank of Vietnam, European Development Bank
Asia lent US $ 30 million, to build and renovate houses, with a loan of VND 100 million to
buy houses or build houses and VND 15 million to repair houses [12, p. 123].
To meet the demand for capital for social housing investment activities, Ho Chi Minh
City has established an urban housing investment and development fund. This fund operates
under the management of the Department of Finance, the capital formed from the sale of
social housing, state-owned houses and land taxes.
4.3.4. Maintenance costs
With the trend of strong development of social housing areas, the formation and
maintenance of activities of social housing management units and providing maintenance
services are indispensable. The organization of life and operation of social housing needs to
follow civilized principles and norms, but not arbitrarily, everyone does it.

Assignment, Essay
Building an appropriate and clear financial mechanism for operation management,
investment, use, maintenance, exploitation of additional services ... will create favorable
conditions for businesses to do well. the ability to manage all aspects, both in terms of
construction quality, to issues of security, safety, order, lifestyle and social housing activities,
ensuring urban civilization, culture and beauty. Thus, new social housing really attracts both
investors and people, bringing practical benefits to improve the quality of life for people in
projects.
4.4. Dwell selling price
4.4.1. Market evaluation
Different income segments have access to different types of social housing finance
products. The higher income segments have more flexibility in accessing social housing
finance while lower income segments rely heavily on microfinance institutions (MFI) for
their Borrow smaller social housing to build gradually. Furthermore, lending institutions in
Vietnam do not apply to informal income customers without proper income and employment
records. The types of social housing finance in Vietnam as well as Ho Chi Minh in particular
are described below (World Bank, 2018)
According to research results in Ho Chi Minh City, the real housing demand of the
three highest income quintiles ranged from 1-2 billion VND for Q5 segment, and 200-800
million VND for fertilizer. Q3-Q4 segment. As follows:
- Q5 income segment is sufficient for housing solutions ranging from 1.8 to 2 billion
VND.
- Income segment in Q3 and Q4 is sufficient for housing solutions of VND 300 - 700
million. For the 30 trillion package, the Q3 and Q4 segments can expand their purchasing
power and can buy houses in the range of 400 to 800 million VND. Ignoring the possible
inflation effect on subsidies, the 30 trillion package extends the nominal purchasing power of
households to about VND 100 million through preferential interest rates. However,
depending on inflation pressure, the actual increase in affordability may be much lower.
4.4.2. Ceiling price policy
Price of social housing is an important key to help people access social housing. Since
early 2014, the market has shown signs of development, social housing prices have fallen to
the same time as in 2006.
There is a fact that prices in many projects and social housing prices are being sold

Assignment, Essay
quite high. For example, house prices at d Lot Plot Project No. 4 - Area 6B - Nam Thanh
New Urban Area, Binh Chanh District are temporarily calculated at VND 16 million / m2
(including taxes and maintenance fees). Meanwhile, regional commercial housing projects
are offering cheaper re-selling prices. For example, social housing in Cho Ray Hospital is
being sold at prices ranging from VND 13.9-14.5 million / m2 (including VAT and 2% of
maintenance costs).
4.4.3. Location
To assess the position of social housing projects, we collected the survey results as
follows:
- Most people rated the housing area as convenient for transport (3.97 / 5),
- Near public transport (3.91 / 5),
- Easy access to children's schools (3.74 / 5),
- Easy access to health facilities (3.71 / 5),
- Near markets, shopping areas (3.82 / 5),
- Near the cultural, sports, parks, amusement parks (3,61 / 5),
- Convenient to work place (3.5 / 5), and in general, people rated favorable locations
with their families (3.65 / 5).
4.4.4. Interest rate
Statistics show that, up to now, Ho Chi Minh City has 98 completed social housing
projects, of which 35 projects are housing for urban low-income people, scale over 18,900
apartments. The rest are housing for industrial park workers. Along with that, 129 social
housing projects are still being implemented, of which 90 projects are houses for low-income
people, about 55,000 apartments. Ho Chi Minh is a locality with great demand for social
housing, but currently has just implemented 14 social housing projects, with ascale of more
than 11,900 units, much lower than the actual demand. Recently, many large projects have
sold quite quickly in a short time, showing a "scarcity" of low-cost housing in the market.
Besides, HCMC has no mechanism and method to compensate interest rates for
investors; no specific bank or credit institution will provide preferential loans to investors to
build social housing.
Ho Chi Minh City now advocates to create conditions for people to access credit loan
packages. The State Bank has announced the circular stipulating the provision of VND
30,000 billion for housing support loans under Resolution No. 02/2013 of the Government,

Assignment, Essay
applicable to objects of civil servants and officials armed forces, low-income subjects
borrowed to rent, hire-purchase social housing with an area of less than 70 m2, selling price
below VND 15 million / m2; investors are investors of social housing construction projects;
Investors who are investors of commercial housing projects are converted to social housing
projects, according to the Ministry of Construction's announcement.
4.5. Building codes and standards
4.5.1. Parameter
Because there is no separate standard, social housing apartments are built today, not
unlike normal commercial houses
For example, at Dong Hung II Apartment, District 12 (representing projects with
average selling prices), the social building is 25 stories high, has a basement, 6 elevators, full
restaurants and supermarkets on the ground floor and apartments. Households range from 60
to 90 m2. Most social housing projects in Ho Chi Minh do not comply with regulations on
social housing design and construction, such as apartments with larger area than regulations
and especially high-rise construction (according to Housing Laws, social housing in special
cities can only be 5-6 floors high
4.5.2. Material
Survey results and assessment of the environment, facilities of the housing area showed
that the assessment of water quality reached 3.27 / 5, enough green space for walking (3.93 /
5) ), Good environment, airy (4.01 / 5), Elevator operating well (3.55 / 5), and a general
assessment of facilities in residential areas is good (3,64 / 5) )
It can be seen that social housing projects are paid attention to by investors by the
construction to create a good environment and architecture in harmony with the natural
environment. Most people (nearly 80% of respondents) are satisfied with the housing
environment. The point of the people is not very satisfied, it is about water quality (3.27 / 5).
4.5.3. Technical system
The concentrated social housing areas of Ho Chi Minh are invested in modern
conditions, creating conditions for low-income audiences, housing difficulties have the
opportunity to own an apartment suitable to the collection level. efficiently import and exploit
the City's 20% land fund by mobilizing lawful investment capital sources to invest in modern
synchronous construction, improving the living and working conditions of laborers; high
standards of urban environment landscape, quality of life, green landscape architecture space,

Assignment, Essay
bringing new and sustainable urban appearance. Concentrated social housing projects change
the thinking about quality and utility for social housing segment, thereby forming healthy and
civilized residential clusters, stable settlements. with living culture ensures true "quality of
life" for occupants.
4.5.4. Sanitary equipment
All 3 surveyed housing areas were highly appreciated (3.87 / 5). Security and order of
the residential areas are well guaranteed, security is always available 24 hours to ensure
security and order ... Especially at Resettlement - Lot R4, R5 belong to 38.4ha switch area ,
Binh Khanh ward, District 2, intelligent security control system was installed to ensure safety
and security for residents during operation, contributing to the shape of a civilized and an safe
housing area. Full for residents. “Coming here to settle down, to live in a healthy
environment, safe and very good urban security. As a citizen, I just hope so ... ”(people's
opinion).
4.6. Project management issues
4.6.1. Design quality
Room area and apartment size.
Unit: (m2)
acreage Bedroom living
room
Dining room. Kitchen WC
A bedroom 30-40 8-12 8-10 Combining living
room
4-6 2-4
2 bedroom 45-65 8-12 9-15 4-8 5-6 2-5
3 bedroom 65-70 7-12 9-15 5-8 5-6 2-4
Source: Survey study, 2018
For social housing, the apartment design should not only be encapsulated in the usual
way of arranging the premises but also need to apply new and creative ways to arrange space
for the minimum construction area but the area use must be maximized, at the same time,
adding green space to apartments, improving comfort and climate
4.6.2. Construction capability
In the report of Ho Chi Minh City Department of Construction in 2018. In 15
inspection projects, there are two projects that have been completed and put into use and are
in the warranty period: Social housing project 157 / R8 To Hien Thanh, Ward 12, District 10

Assignment, Essay
and Dong Hung III Project, District 12; At the time of the test, the two works are still
basically working well. The phenomenon of seepage and minor damage is being repaired by
the investor; The monitoring of tilting and subsidence in the process of using and re-
inspecting elevators at Dong Hung III apartment building, District 12 has not been
implemented by investors and management units.
Most projects are tested to ensure the quality. However, there are still projects due to
the tight inspection and quality control during the construction process; Unsuitable design
solutions (such as no measures to prevent concrete surface cracking at the position of the
jointing of prestressed reinforced concrete slabs) affect the construction quality
4.6.3. PM capability
Although the city has developed regulations and documents instructions on subjects,
conditions and criteria for buying social houses and social houses in the city are relatively
specific and widely disseminated to people through many information channels but there are
still some points The regulation is unclear, or there is no regulation, leading to the application
of investors not consistent and potential risks identified incorrect objects according to the
objectives of the Social Housing Program of Ho Chi Minh City , including:
Firstly, the provision of "long-term temporary residence" is not clear.
Secondly, the understanding of the concept of "household" is not unified between
household members and members in household registration books, leading to the risk that the
member without confirmation may have a home
Thirdly, the certification of the status of housing in the present place has not been fully
implemented for some cases, leading to the risk of uncontrollable status of home ownership
in the current place.
Fourthly, there are not regulations on temporary residence time
Fifth, there is not regulation on the validity period of household registration papers and
housing status
Sixthly, the time for carrying out the procedures for transferring and returning
apartments is still long
4.6.4. Supervision capability
Results of auditing samples to build selling prices of 03/10 social housing projects
appraised by the Inter-Agency Council showed that there are still some problems affecting
the correctness of selling prices of the projects. The above projects such as: Errors in the

Assignment, Essay
estimated value of the loan, the determination of unsuitable interest expense factors,
allocation to the selling price of the expense in contravention of regulations; Results of
recalculation (job sampling audit based on the unit's construction price records) show that the
temporarily calculated selling price may fall below the appraised price or lack of a defined
basis. The contents of selling expenses, contingency costs between projects and basic
explanations determine that the investor's contingency expenses have not been handled
consistently by the Inter-Agency Council.
4.7. Boosting policy by government
4.7.1. Planning policy
To solve the problem of housing for low-income people, workers, students, students,
the City has reserved and arranged land fund for housing development in many forms. As a
result, 66 social housing development projects have been implemented in the city, with about
5,016,177 m2 of housing construction floors. Including 44 social housing projects, low-
income housing with about 37,800 apartments, 10 student housing projects to meet about
39,114 students, 12 housing projects for workers, meeting the above requirement. 40,000
workers.
However, in addition to such achieved results, the City is also facing many difficulties
in determining the subjects to be prioritized for pre-distribution and scope of objects to be
distributed. Accordingly, currently due to limited social housing fund, the subjects who are
prioritized for pre-distribution are those who are policy beneficiaries, war invalids, families
with meritorious services to the Revolution and cadres, civil servants and officials. difficult to
go home in the city.
4.7.2. Financial policy
The Housing Development Fund in Ho Chi Minh City was born with the purpose of
entrusting from the budget and other sources of capital for investment and lending for
housing and technical infrastructure development. housing areas in the city area, receiving
savings deposits, lending to wage earners to buy houses under housing construction
investment projects, being given favorable conditions and incentives under the Decree Decree
No. 71/2001 / ND-CP dated October 5, 2001 of the Government. Besides, this fund is also
used to directly invest in technical infrastructure and housing development projects according
to the decision of the City People's Committee.
In addition, according to Decree 188/2013 / ND-CP, commercial banks, credit

Assignment, Essay
institutions and financial institutions have to spend a minimum of 3% of the total outstanding
loans to investors, lessees and purchasers. Social housing loans with preferential interest rates
are lower than market rates.
4.7.3. Credit policy
For investors of social housing construction, the Ministry of Construction has issued
specific guidelines on the identification of subjects, conditions and procedures for lending to
buy houses in a preferential credit package of 30,000 billion. Accordingly, the borrowed
investors must be social housing investors, commercial housing projects are converted to
social housing projects or investors of residential housing projects. industrial park workers,
houses and houses for low-income people in urban areas as prescribed. All projects must
meet mandatory requirements as approved by competent authorities and written approval of
investment; With clean land and construction permits, in case of exemption from construction
permits, there must be a written certification from the local Construction Department. The
purpose of the loan is to pay unpaid expenses arising from January 7, 2013 to implement
projects.
4.7.4. Policy of tax
HCMC has no mechanism and method for investors to enjoy tax incentives (according
to regulations, investors are entitled to 0% VAT rate, exempted from corporate income tax
for four years). from the time of earning income and 50% reduction of corporate income tax
for the next 5 years (with housing for workers is 9 years) and applied corporate income tax
rate of 10% during the period of operation) .

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The basic human right is to have a suitable and safe accommodation. This legitimate housing demand is necessary conditions to improve the quality of human resources as part of Vietnam's industrialization and modernization