In the context of rapid urbanisation and housing prices far exceeding incomes, economists say it is time to reposition housing as an essential part of national infrastructure - on par with transportation or energy - to promote sustainable and inclusive urban development.
Repositioning housing as an essential part of national infrastructure, promoting sustainable and inclusive urban development.
Viet Nam has been facing the pressure of housing shortage. Analysing this situation, Giang Huynh, Director of Research and S22M Department of Savills Vietnam (a real estate service provider established in the UK, Viet Nam branch) commented: “The biggest legal factor hindering the development of housing supply is the lengthy project approval procedures and the obstacles in implementing existing projects. In the next 6-12 months, priority should be given to resolving the obstacles in determining land use costs and planning approval procedures, so that investors can quickly implement projects and bring products to the market”.
Demand for sustainable housing is growing rapidly in the face of urbanisation
In the face of urbanisation, the demand for sustainable housing will increase rapidly, requiring the Government and investors to proactively seek large-scale solutions to ensure long-term supply. In this context, increasing investment capital flows from both the public and private sectors plays a key role in financing new housing projects and promoting sustainable urban development.
Sustainable urban development is an inevitable and objective trend today.
However, although the housing segment still attracts a lot of investment attention, inherent barriers such as inconsistent planning, unstable policies, or fluctuations in the legal and political environment are still slowing down the implementation of large-scale projects.
In fact, most current housing projects have a relatively short investment cycle of only about 5 years, while institutional investors prioritise investing in areas with stable cash flows for 20 years or longer. This is the reason why many long-term capital sources, the capital needed to solve the problem of affordable housing shortage, have not been effectively exploited.
Repositioning housing as a type of national infrastructure
A potential approach is to reposition housing as a type of national infrastructure. When viewed on the same level as transport or energy, the housing sector becomes more attractive to long-term investors. At the same time, this perspective can also reshape the thinking of policymakers, thereby creating the legal mechanisms, financial incentives and stable support commitments that are essential to promote sustainable investment.
The Vietnamese housing market is actively shifting towards prioritizing residential areas around areas with high public transport density.
In that process, it can be seen that many countries have been successful with this direction. For example, Singapore has been successful in considering housing as a core part of infrastructure. More than 80% of Singaporeans live in state-developed apartments, with fully integrated planning of public utilities and transport. New York and London aim to build tens of thousands of houses each year. Paris is experimenting with a new direction: reusing old buildings and taxing vacant houses to bring unused supply back to the market.
In Viet Nam, the market is also making positive changes in this direction. Notably, the approval of the Thu Duc City Master Plan in January 2025, with a focus on development according to the TOD (Transit-Oriented Development) model, prioritising the construction of high-density residential areas around the public transport system.
Giang Huynh assessed that this is a suitable direction, making optimal use of land funds around Metro lines to develop integrated urban areas. However, in order for the TOD model (Transit-Oriented Development, an urban development model focusing on optimising the space around public transport) to be successfully implemented and quickly increase housing supply, the Government needs to speed up the construction of the Metro line, while building a legal framework and policies attractive enough to attract investors.
At the same time, recent efforts to remove legal obstacles, speed up the issuance of pink books, construction permits and signing of sales contracts are creating a solid foundation for the Vietnamese housing market to recover steadily from the second half of 2025 onwards.
Regarding the housing issue, Party General Secretary To Lam recently mentioned that Viet Nam needs to establish a “National Housing Fund” to develop low-cost housing in large urban areas. This is also a solution to promote urban areas to become a driving force for national growth.
At the Government press conference on March 5, 2025, Director of the Department of Housing and Real Estate Market Management under the Ministry of Construction Tong Thi Hanh said that the Ministry of Construction has assigned specialised units to urgently study international experience, review regulations and propose solutions to establish a National Housing Fund. Accordingly, specialised units of the Department are assigned to research from the planning stage, housing development program plans to project implementation.
In fact, many agencies and organisations have proposed establishing a number of funds to help people have the opportunity to own houses. For example, the Real Estate Brokers Association once proposed that the Government study the establishment of a fund to support the development and maintenance of the supply of low-cost apartments. This fund can be supplemented from the state budget and from private investors.
In 2024, in Directive No.34 on strengthening the Party’s leadership in social housing development in the new situation, the Secretariat directed to study the establishment of a social housing development fund or a suitable financial institution model for long-term, sustainable social housing development. Previously, the Government leader assigned a number of ministries and branches to study the plan to establish a social housing fund, allowing businesses to mortgage assets formed on land to borrow credit capital.
In addition to establishing a housing fund, Viet Nam aims to have 1 million social housing units by 2030. The social housing development target itself has been included in the system of local socio-economic development indicators, according to Directive No.34 of the Secretariat.
This shows that solving the housing problem requires a shift in development thinking, from a short-term approach to a long-term strategy. When housing is seen as a core component of the national infrastructure system, new foundational solutions can be effectively deployed, contributing to shaping a sustainable and synchronous urban future.