HCM City is unlikely to meet its social-housing target of 4,695 apartments for cadres, State officials and low-income earners by 2015 due to shortages in the land fund, according to the city's Department of Construction.

The fund, which sets aside land plots for social-housing projects, consists of State-managed lands, most of which are now fully occupied.

Investors in commercial housing and new urban projects of 10 ha or more are legally required to set aside 20 per cent of their land in each project for social housing.

Between 2000 and 2011, the department approved nine commercial-housing projects developed on 10-ha areas or more, with a total area of 204 ha.

Of that figure, the investors of these projects were required to set aside a total of nearly 40 ha to contribute to the land fund for social-housing projects.

However, the city has received only one ha from investors.

Le Hoang Chau, chairman of the HCM City Real Estate Association, said that developers had encountered difficulties because of the regulation requiring 20 per cent of land set aside for social housing.

He said that companies could avoid the regulation by developing housing projects on areas of 10 ha or less.

The regulation is a major burden for companies, according to Nguyen Van Duc, deputy director of Dat Lanh Real Estate Company.

It also discourages companies from developing commercial-housing projects adjacent to the social-housing projects on the land contributed by investors.

The Department of Construction has proposed that the city's People's Committee allow investors to pay money to the city that would be equal to the cost of the 20 per cent of land that would be set aside for social housing.

The investors could also offer land plots located outside their projects that could be used for social housing.

Source:  VNS