Does the government have new proposals that could drive down housing prices in Vietnam?

The Government has just submitted a document to the National Assembly on a resolution to pilot the implementation of commercial housing projects through agreements on receiving land use rights, or having land use rights. In the draft resolution, the Government said the purpose of this document is to create a legal corridor to manage the land use rights market, the real estate market to develop stably, healthily, openly and transparently.

In particular, it creates conditions for land users and investors to be proactive in implementing commercial housing projects and urban development projects, minimizing the intervention of administrative agencies, limiting the occurrence of administrative procedures, reducing compliance costs, and limiting land acquisition by the State, which can easily lead to lawsuits.

Illustration photo. (Source: ST)

Regarding this issue, Mr. Le Hoang Chau, Chairman of the Ho Chi Minh City Real Estate Association (HoREA), welcomed the Government's action on the proposal to allow investors to negotiate on receiving land use rights or having land use rights for land other than residential land to carry out commercial housing projects.

Mr. Chau hopes that the proposal will be considered and approved by the 15th National Assembly at the 8th session, scheduled to open on October 21, 2024, which will remove obstacles caused by regulations in the 2024 Land Law.

Specifically, at Point b, Clause 1 and Clause 6, Article 127, investors are not allowed to negotiate on receiving land use rights or having land use rights for land other than residential land to implement commercial housing projects.

If approved by the National Assembly, it will create conditions for investors and businesses to access land through agreements on receiving land use rights or having land use rights for land other than residential land to carry out commercial housing projects on the basis of voluntary agreements, "willing buyers and willing sellers" between people and businesses.

“If this proposal of the Government is approved, it will help avoid disputes and lawsuits, in addition to land access methods through land use rights auctions or bidding to select investors for projects using land, helping to increase the supply of projects and commercial housing products to contribute to reducing housing prices,” said Mr. Chau.

It is known that the provisions of the 2003 Land Law, the 2013 Land Law, and the 2005 Housing Law allow investors to implement commercial housing projects through agreements on receiving land use rights, or having land use rights like other socio-economic development projects without specifying specific conditions on land types.

However, the 2023 Housing Law does not stipulate conditions on land types for implementing commercial housing projects, but refers to the provisions of the Land Law. However, according to the provisions of the 2024 Land Law, the State only reclaims land for urban area projects with mixed-use functions. Projects that synchronize technical infrastructure systems, social infrastructure with housing according to the provisions of law for new construction or urban renovation and embellishment; rural residential area projects.

With the above regulations, the implementation of investment projects and commercial housing business faces many difficulties due to the lack of legal basis and conditions for cases of receiving land use rights that are not residential land, or having land use rights that are not residential land to implement the project. Therefore, in these cases, the investment policy to implement the project is not approved.

In fact, most new real estate development projects, especially large-scale projects, are implemented on land that is not originally residential land, in many cases only agricultural land, while Vietnam's current policy is to promote urbanization and rearrange urban areas and rural residential areas.

In particular, the supply of real estate projects in recent times has not met demand. Therefore, real estate prices have increased, partly due to difficulties in accessing land to implement commercial housing projects.

This reality requires expanding the conditions for receiving land transfers to implement commercial housing projects. The goal is to promote the country's urbanization process, solve the need for residential land and housing for the people, facilitate investors, reduce administrative procedures, compliance costs, and create supply for the market.

Source: https://www.congluan.vn/chinh-phu-co-de-xuat-moi-ky-vong-keo-gia-nha-o-tai-viet-nam-di-xuong-post316952.html