Expect 3 new laws to help untie the market 'bottlenecks'2 segments 'bright' for investmentConditions for buying social housing

In the short term, the Vietnamese real estate market is expected to remain stable, with strong growth in industrial and residential real estate in highly urbanized areas. (Photo: Linh An)

Market Highlights

According to the Vietnam Real Estate Brokers Association, in August 2024, the Vietnamese real estate market continued to face many challenges and opportunities, reflecting fluctuations in the global economy and domestic regulatory policies.

Accordingly, the housing segment is still a bright spot in the market, especially in big cities like Hanoi and Ho Chi Minh City. However, access to finance is still a major barrier for many home buyers, leading to a decline in real estate transactions.

Industrial real estate continues to grow strongly, especially in the context of increasing FDI inflows into Vietnam.

Specifically, new industrial parks in localities such as Bac Ninh , Binh Duong and Long An are attracting the attention of foreign investors, mainly in the manufacturing and logistics sectors.

Real estate experts believe that in the short term, the Vietnamese real estate market is expected to continue to be stable, with strong development of industrial and residential real estate in highly urbanized areas.

However, it should be noted that factors such as inflation, monetary policy and the global economic situation could have a major impact on market developments in the coming months.

Expectations from 3 new laws

According to Nhandan , the recovery signals of Vietnam's economy are increasingly clear with the Government's management orientation striving to achieve the GDP growth target of 7% for the whole year, opening up many expectations for the recovery and development of investment channels, including the real estate market.

In the first half of 2024, the real estate market received positive growth signals in many segments, especially apartment products that are recovering in both supply and liquidity. The number of customers deciding to "put down money" to buy real estate for investment and to buy for living has grown significantly in both the primary and secondary markets. This has helped the absorption rate of many projects improve slightly.

The industrial real estate segment is starting to become vibrant to welcome the fourth wave of foreign direct investment (FDI) pouring into Vietnam; the apartment segment is also warming up with new price increases and improved liquidity; land plots are also starting to record signs of recovery as transactions and transfers increase.

Notably, the National Assembly's permission for three laws related to the real estate market, including the Land Law, Housing Law, and Real Estate Business Law, to take effect from August 1, 2024, 5 months earlier than the regulations, is creating expectations for a more positive recovery of the real estate market in the second half of 2024. The basis for this belief is the promulgation of new (amended) laws that have overcome previous limitations and problems with many innovative and progressive regulations that can be applied immediately without the need for detailed guidance documents.

The view of the lawmakers is to unify institutional regulations related to land use, to avoid overlapping and conflicting laws, to help investment activities and the use of land resources become clear and transparent, and to promote practical capacity. Therefore, when officially put into effect, the laws will create a new legal corridor, removing most of the "bottlenecks" for the market because 70-80% of the current problems are due to the law.

To ensure effectiveness in the implementation process, the related decrees are also being accelerated on the basis of ensuring quality content, closely following the market. Of course, it still takes enough time for the law to "absorb", but the real estate market is forecasted to continue to recover sustainably with gradually better results and by the end of the year, the market's recovery process will have clear progress.

For these reasons, the "bright door" is opening when real estate becomes a channel that investors consider choosing alongside other popular investment channels such as stocks, foreign currency, gold, deposits... When the real estate market "warms up" again, it will bring in revenue, promote economic development through positive effects and spread to many other industries and sectors in the economy.

Land price list continues to be applied until the end of 2025

The land price list issued by the Provincial People's Committee according to the provisions of the 2013 Land Law (old land price list) will continue to be applied until December 31, 2025.

The above information was stated by the Ministry of Finance in a document on implementing the provisions of the 2024 Land Law, which has just been sent to ministries, ministerial-level agencies, government agencies, other central agencies and People's Committees of provinces and centrally run cities.

Regarding the issue of handling the transition to apply the land price list, the Ministry of Finance said that the land price list issued by the provincial People's Committee according to the provisions of the 2013 Land Law will continue to be applied until December 31, 2025.

“If necessary, the provincial People's Committee shall decide to adjust the land price list according to the provisions of this law to suit the actual situation of land prices in the locality,” the document of the Ministry of Finance stated.

According to the 2024 Land Law, effective from August 1, from 2026, land price lists will be issued by provincial People's Committees once a year to keep up with the market, instead of every 5 years as per the old regulations.

Late last month, Ho Chi Minh City released a draft of the adjusted land price list. The prices in the adjusted land price list are much higher than the old land price list, with many places increasing 10-30 times, and in some places even increasing 51 times.

According to the leader of the Department of Natural Resources and Environment of Ho Chi Minh City, the adjustment is necessary because the 2020 land price list currently in use has some shortcomings. The land price list is adjusted to suit the actual situation and land prices in the area.

However, the City has not yet applied this adjusted land price list due to the need to carefully consider the factors.

Previously, people in Ho Chi Minh City also rushed to complete land procedures because they were worried that the adjusted land prices would increase, affecting cases of applying for certificates and changing land use purposes.

In recent days, many land use conversion files in Ho Chi Minh City have been suspended due to problems in calculating taxes as the tax authority awaits instructions.

Perspective of social housing project in Duy Tien town, Ha Nam. (Source: VGP)

What are the conditions for buying social housing?

According to the provisions of Articles 29 and 30 of Decree No. 100/2024/ND-CP dated July 26, 2024 of the Government detailing a number of articles of the Housing Law on the development and management of social housing (effective from August 1, 2024), to enjoy social housing support policies, the following housing and income conditions must be met:

No housing or average housing area per capita is less than 15m2

"Article 29. Housing conditions

1. The case of not having a house of one's own is determined when the subject specified in Clause 1, Article 77 of the Housing Law and the subject's spouse (if any) are not named in the Certificate of land use rights and ownership of assets attached to land in the province or centrally run city where the social housing project is located at the time of submitting the application for purchase or lease-purchase of social housing.

Within 7 days from the date of receipt of the request for confirmation of the name in the Certificate of land use rights and ownership of assets attached to land, the Office/Branch of the district-level land registration office of the province or centrally-run city where the social housing project is located shall carry out the confirmation for the case specified in this Clause.

2. In case the subject specified in Clause 1, Article 77 of the Housing Law owns a house but the average housing area per capita is lower than 15 m2 of floor space/person. The average housing area per capita specified in this Clause is determined on the basis of including: the applicant, that person's spouse, father, mother (if any) and that person's children (if any) registered as permanent residents in that house.

Within 7 days from the date of receipt of the application for confirmation of average housing area per capita, the People's Committee at the commune level shall carry out the confirmation for the case specified in this Clause".

Income not more than 15 million VND/month

"Article 30. Income conditions

1. For subjects specified in Clauses 5, 6 and 8, Article 76 of the Housing Law, the following income conditions must be met:

a) In case the applicant is single, the actual monthly income received must not exceed 15 million VND, calculated according to the Salary and Wage Table confirmed by the agency, unit or enterprise where the applicant works.

In case the applicant is married according to the law, the applicant and his/her spouse must have a total monthly income of no more than 30 million VND calculated according to the Salary and Wage Table confirmed by the agency, unit or enterprise where the applicant works.

b) The time for determining income conditions within 01 consecutive year, calculated from the time the subject specified in this Clause submits a valid application to the investor to register to buy or lease-purchase social housing.

2. In case the subject specified in Clause 5, Article 76 of the Housing Law does not have a Labor Contract, if he/she is single, the actual monthly income received shall not exceed 15 million VND, if he/she is married according to the provisions of law, the applicant and his/her spouse shall have a total actual monthly income received not exceeding 30 million VND. Within 07 days from the date of receipt of the request for confirmation, the People's Committee at the commune level shall confirm the income condition in 01 consecutive year from the time the subject specified in this Clause submits a valid application to the investor to register to buy or rent-purchase social housing.

3. For subjects specified in Clause 2, Clause 3 and Clause 4, Article 76 of the Housing Law, they must be poor or near-poor households according to the Government's poverty standards.

4. For the subjects specified in Clause 7, Article 76 of the Housing Law, the income conditions specified in Article 67 of this Decree shall apply."