Land prices will increase, the reason why Hanoi apartments continuously set records, cases where foreign individuals are allowed to own houses

It is necessary to tighten the subdivision and sale of land, the reason why Hanoi apartments continuously set records, Quang Binh is about to auction 128 plots of land, starting from 560 million VND... are the latest real estate news.

The revised Law on Real Estate Business stipulates that land use rights cannot be transferred to individuals who build their own houses or divide plots of land into plots for sale in wards, districts, and cities of special, type I, II, and III urban areas, and are subject to auctions of land use rights to invest in housing construction projects according to the provisions of the Land Law. (Source: Dan Tri)

Land prices may be pushed up

According to statistics from the Ministry of Construction, by December 2023, there will be 902 urban areas nationwide. The above statistics are directly related to the regulation on banning the subdivision and sale of land plots in the revised Law on Real Estate Business, which will take effect in early 2025.

Specifically, the amended Law on Real Estate Business stipulates that land use rights cannot be transferred to individuals who build houses themselves, divide plots of land for sale in wards, districts, and cities of special-class, class I, II, and III urban areas, and are subject to auctions of land use rights to invest in housing construction projects according to the provisions of the Land Law.

For the remaining areas, the provincial People's Committee shall, based on local conditions, determine the areas where project investors are allowed to transfer land use rights with technical infrastructure to individuals for self-construction of houses.

Regarding this regulation prohibiting the subdivision and sale of land, many real estate experts believe that in the next year or so, the land market will have many strong fluctuations. The tightening of subdivision and sale of land will make the supply scarce and prices may be pushed up.

Mr. Nguyen Van Dinh - Chairman of the Vietnam Association of Real Estate Brokers (VARS) - said that the demand for land is always very high while the market lacks supply from official projects.

"Many speculators have taken advantage of the opportunity to collect land, then divide it into plots to sell, split the plots, and even name the projects the same as legitimate ones to attract buyers. At the same time, they compete to inflate prices, "push" real estate prices up, causing chaos in the market," Mr. Dinh said, affirming that tightening the division and sale of land is necessary.

According to real estate expert Dinh Minh Tuan, the ban on land subdivision and sale according to the new regulations can reduce the rampant subdivision, the supply to the market will also "shrink", helping to reduce the waste of land resources.

However, land trading activities in the coming time will also be affected. In the first stage, the land market will be unstable because currently 90% of land trading transactions in the market are subdivided land.

After the regulation is implemented, there may appear a large number of large-area land products for sale at discounted prices, coming from investors who accidentally "hold" land with the purpose of dividing and splitting plots to make a profit.

On the contrary, the prices of subdivided land plots with certificates in localities where subdivision is prohibited will be pushed up and there is a possibility of a wave of "running" to subdivide and split plots before the law officially takes effect.

The official tightening of land subdivision will not only affect small groups of people. Because in urban areas of type 2 and 3, the number of investors participating in land investment is very large. Because this type of investment has good liquidity and high demand, some investors "hoard" goods and resell them at high prices.

"Invisibly, the price of subdivided land is also higher than the average price of land sold by people," Mr. Tuan emphasized.

According to Mr. Tuan, the ban on land subdivision and sale in 105 cities and towns will reduce purchasing power in these markets, but land in class I cities will attract stronger cash flows. Because investors see too much risk outside and will wait for issues related to land subdivision to stabilize, then consider returning to these areas. In the immediate future, central markets will still attract cash flows due to the obvious increase in investment demand.

Mr. Tuan recommends that at this time, land investors need to consider carefully when investing in land plots in areas that are in the transition period according to the Law on Real Estate Business or the Law on Housing, especially in areas where subdivision and sale of land plots are prohibited. Buyers need to make sure that the investment land plot has a certificate.

Sharing the same view, Mr. Le Hoang Chau - Chairman of the Ho Chi Minh City Real Estate Association (HoREA) - said that in the long term, tightening the subdivision and sale of land will help this market develop in a transparent and sustainable direction, prevent speculation, land "fever", and limit land waste.

What causes Hanoi apartment prices to soar?

The demand for housing is constantly increasing, putting pressure on supply and pushing real estate prices in general to continuously set new levels, each higher than the previous.

In particular, the apartment segment in Hanoi has continuously experienced a price fever. The Vietnam Association of Realtors (VARS) has pointed out the factors that have caused apartment prices in Hanoi to continuously set new records.

Since 2018, policies related to capital sources and decisions of agencies and departments in controlling the real estate market have been one of the reasons for the serious decline in the supply of residential real estate.

VARS research data shows that apartment prices in Hanoi have increased for dozens of consecutive quarters. The apartment price index in Hanoi in the first quarter of 2024 increased by 48% compared to the first quarter of 2019 and increased by 8 percentage points compared to the last quarter of 2023 - the highest increase in the past 5 years.

VARS experts pointed out that infrastructure is constantly being improved, so real estate value also increases proportionally to investment. However, it is unreasonable to invest 3-4 times for just one investment.

The reasons why Hanoi apartment prices continuously hit the peak are due to the large investment demand when large cash flows are "flowing" strongly into real estate to hold assets, especially in the context of bank interest rates hitting "rock bottom". In addition, the demand for investment in rental apartments is also driven by the accommodation needs of a large number of international tourists, foreign experts or students flocking to the capital.

Meanwhile, the supply is too insufficient, there is a shortage of goods to meet the market demand. According to the general psychology, the demand for home ownership of Vietnamese people is always high and is still on the rise... A series of these factors simultaneously affect the price of the apartment segment in Hanoi to continuously break its own price record.

VARS calculates that by 2025, Hanoi's population is expected to reach 9 million people, with an expected urbanization rate of 62%. Thus, by 2025, the population living in urban areas will reach about 5,580,000 people, up from 4,138,500 people in 2022; equivalent to about 120,000 new urban households each year.

At the same time, VARS cited data from the Hanoi Housing Development Plan for the period 2021-2025, which also showed that the total demand for the period 2022-2025 is 185,200 houses; of which, there are 166,600 apartments. While the reality is that the number of newly opened apartments for sale in Hanoi is continuously decreasing.

In 2023, the total supply of new apartments will only reach approximately 11,000 products, equal to 66% compared to the same period in 2022. In the first quarter of 2024 alone, the entire Hanoi market will only record about 3,000 newly opened apartments.

Thus, from now until 2025, on average, Hanoi will still lack about 50,000 apartments each year. Meanwhile, the number of newly licensed commercial housing projects is continuously decreasing and people are reluctant to sell their houses for fear that if prices continue to increase, they will not have enough money to buy another house; especially now that there are no apartments with "affordable" prices on the market.

In 2023, the total supply of new apartments will only reach approximately 11,000 products, equal to 66% compared to the same period in 2022. (Photo: HA)

Cases in which foreign organizations and individuals are allowed to own houses in Vietnam

Article 17 of the Housing Law 2023 (effective from January 1, 2025) stipulates foreign organizations and individuals who are allowed to own houses and forms of house ownership in Vietnam.

Accordingly, foreign organizations and individuals are allowed to own houses in Vietnam, including:

Foreign-invested economic organizations invest in housing construction projects in Vietnam according to the provisions of this law and other relevant legal provisions;

Foreign-invested economic organizations, branches, representative offices of foreign enterprises, foreign investment funds and foreign bank branches operating in Vietnam (hereinafter referred to as foreign organizations);

Foreign individuals are allowed to enter Vietnam.

Foreign organizations and individuals specified in Clause 1 of this Article are allowed to own houses in Vietnam, including apartments and individual houses through the following forms:

The organization specified in Point a, Clause 1 of this Article is allowed to own houses through the implementation of housing construction investment projects in Vietnam;

Organizations and individuals specified in Point b and Point c, Clause 1 of this Article are allowed to own houses through purchasing or hire-purchasing commercial houses from investors of housing construction investment projects, receiving gifts or inheriting commercial houses in housing construction investment projects not located in areas requiring national defense and security as prescribed in Article 16 of this Law;

Organizations and individuals specified in Point b and Point c, Clause 1 of this Article are allowed to own houses through purchasing or hire-purchasing houses from foreign organizations and individuals who already own houses as prescribed in Point b of this Clause.

Quang Binh is about to auction 128 land plots

Quang Binh province is going to auction the right to use 128 land plots in Quang Trach district, Ba Don town and Dong Hoi city next May. The lowest starting price is 560 million VND and the highest is nearly 6 billion VND.

In Ba Don town , 50 plots of land owned by the Ba Don town Land Fund Development and Investment Project Management Board will be auctioned for land use rights by the Quang Binh Province Property Auction Service Center on the afternoon of May 7.

The 50 auctioned plots are rural residential land with long-term use. The plots belong to the residential infrastructure project along the main road from National Highway 12A to the central cluster of communes in the Southern region, Ba Don town.

Plot area from 160-240m2. Starting price from 560 million VND to over 2 billion VND/plot.

The deadline for receiving registration documents and bids is 4:30 p.m. on May 4. The announcement of bids will take place at the hall of the People's Committee of Quang Hoa commune, Ba Don town.

Also in Ba Don town, the Quang Binh Province Property Auction Service Center continued to organize the auction of land use rights for 10 plots of land on the afternoon of May 13.

The auctioned land plots are all urban residential land, belonging to the technical infrastructure project of Dong Mua residential area, Quang Thuan ward, Ba Don town.

Area of ​​each plot is from 160.8-237 m2/plot. Starting price from 746 million VND to over 1.3 billion VND/plot.

Deadline for receiving auction documents and bids is 4:30 p.m. on May 10, at the People's Committee of Quang Thuan Ward.

The announcement of the paid price will take place at the hall of the People's Committee of Quang Thuan ward.

In Quang Trach district , 42 land plots owned by the People's Committee of Quang Phu commune will be auctioned for land use rights by the Quang Binh Province Property Auction Service Center on the morning of May 16.

42 plots of land are rural residential land, with long-term use; belonging to the technical infrastructure project of the residential planning area of ​​Nam Lanh village, Quang Phu commune.

Area from 200-303.6 m2/plot. Starting price from 680 million VND to nearly 1.4 billion VND/plot.

The auction is conducted by indirect voting only once during the application submission period. The deadline for submitting application and bid forms is 4:30 p.m. on May 13, at the headquarters of the People's Committee of Quang Phu commune.

The announcement of the price paid will take place at the hall of the People's Committee of Quang Phu commune.

In Dong Hoi City , on the morning of May 13, the Quang Binh Province Property Auction Service Center and the Quang Binh Province Civil and Industrial Construction Investment Project Management Board will organize an auction of the right to use 26 land plots.

Land plots belonging to the technical infrastructure project of residential area at Duc Ninh Dong Ward Administrative Center.

Plot area from 126-331.5 m2/plot. Starting price from over 1.4 billion to over 5.9 billion VND/plot.

The time to register to participate in the auction and vote for bids is until 4:30 p.m. on May 10. The announcement of bids will take place at the hall of the Quang Binh Province Property Auction Service Center.

Source: https://baoquocte.vn/bat-dong-san-moi-nhat-gia-dat-nen-se-tang-ly-do-chung-cu-ha-noi-lien-tiep-lap-ky-luc-truong-hop-ca-nhan-nuoc-ngoai-duoc-so-huu-nha-269626.html