People are worried
It is expected that from August 1, Ho Chi Minh City will issue a new land price list, adjusting it to increase from 5 times to 20-30 times compared to the current land price list, depending on the area. In particular, the outlying districts such as Can Gio, Cu Chi, Hoc Mon, Nha Be... have the strongest increase.
Estimated land price list on some streets in District 1.
Ms. Nguyen Thi Huyen (Binh Thanh District) was surprised by the news that Ho Chi Minh City has a draft to issue a new land price list and apply it at the beginning of August. She only learned about it a few days ago through friends. Ms. Huyen and her friend bought a plot of land in Cu Chi, some of which is residential land, the rest is land for perennial crops. Her family plans to add more residential land, then separate the land title.
With the information of the land price list in Cu Chi suddenly increasing sharply, Ms. Huyen is worried because she has no financial plan. If calculated according to the new land price plan, she may lose several hundred million VND to get residential land.
Like Ms. Huyen, Ms. Tran Thi Anh (Hoc Mon district) is worried that the new land price list has increased many times compared to the current price. Her family lives on the land of her ancestors, has not changed the land use purpose, and has not divided the plot. For a long time, she and her husband have lived with their parents, but due to not having enough money, they have not been able to complete the procedures to separate the book, get a red book, and have not changed the land use purpose. If the city suddenly applies the new land price, Ms. Anh thinks that her family will have difficulty managing finances and separating the book.
In addition, Ms. Anh also wishes to delay the application of the new land price list for a while longer so that people can get used to it and calculate suitable options.
Ms. Anh and Ms. Huyen are the cases directly affected by the new land price list. According to the Department of Natural Resources and Environment (TN&MT) of Ho Chi Minh City, the new land price list will affect 12 groups of subjects. The group least affected is the case of resettlement, the adjusted land price list will ensure the similarity of specific land prices and be consistent with market prices.
The remaining 11 groups of subjects will be directly affected. Of which, the two most affected cases are households and individuals recognized for land use rights and land use purpose change.
Land prices on many roads in the central area of Ho Chi Minh City have increased about 5 times compared to the current price list (Illustration: Hai Long).
However, the Department believes that cases of stable land use before October 15, 1993 do not have to pay land use fees. In cases where the land area exceeds the limit, the land price list of 2005 will be collected.
The remaining land use cases will be considered based on the origin and time of land use to have an appropriate collection rate. In the draft decree on land use fee and land rent collection that the Government is about to issue, the collection rate based on time is from 10% to 50% of the expected adjusted land price list. In addition, land users belonging to policy families, meritorious people, and poor households will be exempted from land use fees according to Government regulations.
Will the new land price list increase housing prices?
Mr. Vo Hong Thang - Director of Consulting Services and Project Development, DKRA Group - said that the draft land price list compared to the land price frame increased 5-30 times but the current price is close to 70% of the market price. Many people misunderstand that the land price list is the tax that people have to pay when converting the purpose to residential land, but that is not true.
The tax will have an adjustment coefficient and tax calculation method, so we need to wait for more decrees and circulars from state management agencies to accurately calculate the cost of people having to change land use purposes, Mr. Thang said.
Overall, Mr. Thang assessed that the new land price list affects two groups. For the people, the new land price list affects the land use conversion tax but only increases by 0.5 times to 1 time, depending on the area.
For businesses, the new land price list increases the cost of site clearance and compensation because it is getting closer to the market price. The cost of land use increases, and the accompanying taxes and fees will increase. These factors make up the selling price of real estate and the price will increase in the future.
However, on the positive side, he said that the new land price list shows the effectiveness of the 2024 Land Law that is about to take effect, helping to shorten the time for legal project implementation and clear legal obstacles. Especially in the issue of compensation and clearance, when approaching the market, it will be easier for businesses to negotiate with people.
Second, the calculation of land use fees is resolved. Even if land use fees increase, it will shorten the time for legal project implementation, and businesses will save on financial costs.
Mr. Thang expects that the three laws that are about to come into effect will clear up legal issues for projects and shorten the time for project licensing, so that businesses can save on financial costs and business management costs. These two types of costs will be saved, which will "balance" the land use fee, thus reducing the increase in real estate prices.
He also assessed that the application of the new land price list from August 1 is an effort by the State management agency to quickly bring real estate-related laws into life. This shortening will speed up the market's recovery process. Of course, when the State agency issues drafts, circulars, and guiding decrees, it will receive mixed reactions from the market.
He believes that state agencies will make appropriate adjustments to facilitate practical application. Multi-dimensional feedback is necessary, demonstrating the interest of market participants.
Experts say real estate prices will increase when land prices increase (Illustration: Trinh Nguyen).
At a recent press conference, the leader of the Department of Natural Resources and Environment explained the immediate application of the new land price list from August 1.
Mr. Nguyen Toan Thang - Director of the Department of Natural Resources and Environment of Ho Chi Minh City - said that the 2024 Land Law, which is about to be applied, stipulates that the land price list issued by the provincial People's Committee according to the old law will continue to be applied until the end of 2025. If necessary, the provincial People's Committee will decide to adjust the land price list to suit the actual situation in the locality.
Based on this regulation, the Ho Chi Minh City People's Committee considers that the 2020 land price list is no longer appropriate. In addition, it is necessary to issue resettlement land prices according to the new land law.
Therefore, in early July, the Ho Chi Minh City People's Committee assigned the Department of Natural Resources and Environment to preside over and coordinate with departments, branches and localities to draft a revised land price list. The new land price list will no longer have an adjustment coefficient but only a single price frame and will include resettlement land prices according to the new land law.
When asked about the increase in land price list will increase real estate prices, Mr. Nguyen Toan Thang said that this information is not correct. According to Mr. Thang, the basis for building the land price list is based on market data and land price base, over the years there is data from the Ho Chi Minh City Tax Department, Ho Chi Minh City Land Registration Office.
This draft price list is an update of actual transaction data and the Department of Natural Resources and Environment of Ho Chi Minh City has adjusted it and will not increase real estate prices, on the contrary, the price reflects the correct transaction price in the city. In addition, the Department also said that the land price that the Department submitted to the City People's Committee is about 70% of the current market price.
A representative of the Land Economics Department (Department of Natural Resources and Environment of Ho Chi Minh City) added that the new land price list does not affect the input costs of the project, so it does not increase real estate prices. In addition, real estate prices operate according to the law of supply and demand, not because of this land price list that increases or decreases.
For cases where people submitted land procedures before August 1 this year, a representative of the Department of Natural Resources and Environment said that the agency will apply the land price list at the time of receiving complete documents.
Source: https://dantri.com.vn/bat-dong-san/ban-khoan-voi-bang-gia-dat-moi-tai-tphcm-20240801062107160.htm
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