The minister of construction, Trinh Dinh Dung, said that the credit stimulus package, amounting to VND30 trillion (USD1.42 billion), is necessary to support the real estate sector.

Construction Minister Trinh Dinh Dung

During a television interview on April 14, the minister attempted to ease doubts about the package, saying that it would be sufficient to save the domestic market.

He said that the move would empower more state employees and disadvantaged families to buy homes, which would give a boost to real estate.

The effect of the real estate market on the entire economy is quite significant, he said, and has impacts for jobs in manufacturing of construction materials and other sectors. The severity of the issue prompted the National Assembly to take measures to actualise the bailout.

Some have said that the bailout is too small. However Dung argued, "Even though the package is small, it can play a crucial role in exempting low-income people from land use taxes in housing projects. The government is also in the second stage of project 167, which will benefit more than 500,000 low-income households, and will also offer aid to about 70,000 war veterans and 60,000 people living in the northern and central regions who are vulnerable to storms and floods," 

Allowing foreigners to buy property in Vietnam is also an essential step toward improving the real estate market, he added.

Concerns about the real estate market's influence over the entire economy has prompted the Ministry of Construction to plans to plan for submission of a new proposal to the government this year, which could include some of these reforms.

Dr. Le Dang Doanh agreed with such reforms, saying that, amid the growing bad debt in the real estate market and oversupply, saving this sector is essential.

“The real estate sector is interconnected with so many other industries that saving it could mean saving the economy,” Doanh noted.