A view of HCM City's downtown. Experts have said the real estate market won’t recover until late 2024.(Photo: VNA)

Speaking at a forum last week, Nguyen Quoc Hiep, Chairman of the Vietnam Association of Construction Contractors, said the market would continue facing prolonged hurdles such as a lack of access to capital, credit tightening, legal bottlenecks and delays in bond payments.

Decree 08 recently issued by the Government aimed at removing difficulties for the corporate bond market is not effective enough to regain investor confidence in the market, he said.

“The decree, which allows issuers to extend bond terms by up to two years, only helps prevent the market from collapsing but it does not actually protect the rights and benefits of bondholders.”

A huge amount of bonds is going to mature this year and next year, putting great pressure on issuers, mostly property developers, as they now face liquidity problems and cannot issue new bonds to restructure debt, he noted.

He said it was vital to develop a long-term legal basis for corporate bond issuance in order to build a sustainable capital market for the real estate sector.

Do Viet Chien, Vice Chairman of the Vietnam Real Estate Association, said property firms must be well prepared as the market would continue facing obstacles in the coming time.

A recently set up task force aiming to remove difficulties for the market now faces issues beyond their authority in terms of provisions of laws, he added.

The task force should have more power to resolve the challenges faced by property firms, he said. "It should also work directly with real estate firms to assist them in addressing their issues."

Once the Law on Land, the Law on Housing, and the Law on Real Estate Business are finalised, hopefully they will provide opportunities for investors to come back to the market, he said.

Dr. Nguyen Van Dinh, Vice Chairman of the Vietnam Real Estate Association, said the market has faced unprecedented problems in the past five years with a large inventory and a sharp drop in liquidity.

The market has seen a huge imbalance between supply and demand with an oversupply in the high-end segment but a shortage of affordable housing products, he said.

He recommended property developers focus on affordable housing and social housing projects in order to address the mismatch between supply and demand.

It’s vital to have specific regulations to implement the 120 trillion VND support package to finance social housing projects and housing projects for workers, he said.

Bond issuers must develop specific debt repayment plans and actively negotiate with bondholders in order to regain their confidence in the market, he added.

The Government has already issued four directives to remove challenges for the economy, especially the real estate market.

It has also taken measures such as rescheduling and deferring debt, tax, and land rent for real estate businesses.

However, experts have urged property firms to take efforts themselves first instead of replying too much on Government support measures./.