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| Reports recently published by many real estate research units show that from the second quarter of 2022 to the second quarter of 2023, the land segment is still witnessing a very gloomy level of interest. (Source: Tien Phong) |
Continuous suspension of land auctions
Recently, Dong Anh district (Hanoi city) continuously posted notices to temporarily suspend the organization of land use rights auctions under the project of constructing technical infrastructure for the land use rights auction area in Van Ha commune, Dong Anh district.
Specifically, on July 21, Lac Viet Auction Joint Stock Company and Vietnam Auction Joint Stock Company simultaneously posted notices of temporary suspension of land use rights auctions for 28 plots of land in block LK1 and 20 plots of land in block LK3 of the project to build technical infrastructure for the land use rights auction area in Van Ha commune, Dong Anh district.
The reason for the suspension is based on Official Dispatch No. 1778/UBND - TNMT dated July 21 and Official Dispatch No. 755/QLDA - KHTH of the People's Committee of Dong Anh District and the Dong Anh District Investment and Construction Project Management Board on the temporary suspension of the auction of land use rights at plots LK1 and LK3.
Previously, 28 plots of land in block LK1 were announced for auction on July 22 with an area of 130.8 - 276.65m2 and were offered for auction with a starting price of 29.7 - 34.4 million VND/m2. Thus, the auction was unexpectedly suspended exactly 1 day before the official date as announced earlier.
The remaining 20 plots of land in block LK3 were announced for auction on July 29 with areas ranging from 126 - 270 m2/plot and starting prices from 29.7 - 34.4 million VND/m2.
According to the announcement, customers who have purchased auction documents and paid a deposit (if any) will have their documents refunded within two working days from the date of announcement (July 21).
At the end of April this year, Dong Anh district also announced the temporary suspension of land auctions for 44 plots of land in land lot X6, Ha Lo village, Lien Ha commune.
Accordingly, 44 plots of land will be auctioned in 2 rounds, each round the district will auction 22 plots. As previously planned, the first round of land auction will be held on April 23 and the second round will be held on May 6. The plots of land will have an area of 90 - 154 m2/plot and the starting price will be from 30.3 - 33.3 million VND/m2.
Previously, the 44 plots of land whose auctions were suspended were announced to be auctioned on March 18. However, the plots were announced to be auctioned again in late April and early May, and then announced to be suspended again.
Land prices remain sluggish due to buyer confidence
Reports recently published by many real estate research units show that from the second quarter of 2022 to present, the land segment is still witnessing a very gloomy level of interest.
When the market is "hot", land is the segment that receives a lot of attention and is absorbed very quickly, but when the market slows down, land has the deepest decline. Because land is a segment that is more speculative than the need to exploit cash flow.
Some real estate experts assess that the transaction situation in the land market is still quiet due to the confidence of buyers. Difficulties in credit limits and loan interest rates have not been completely resolved, causing buyers to "hesitate".
According to Mr. Nguyen Quoc Anh - Deputy General Director of Batdongsan.com.vn, real estate transactions are difficult to succeed because the expectations between sellers and buyers are still far apart.
Specifically, according to the survey, among the reasons why investors need to sell real estate, 49% is to restructure their investment portfolio; 23% is because they do not need to use it, so they resell it; only 22% is due to financial difficulties, having to transfer to solve economic problems.
"Because the group of sellers who need to "get rid of their goods" due to financial difficulties is not high, most of them still hope to sell their real estate at a profit, with profits fluctuating around 10%," Mr. Quoc Anh shared.
Regarding liquidity, many experts believe that if interest rates fall below 10%/year and the market warms up, the real estate investment wave may rekindle, and cash flow for businesses may be more abundant.
On the contrary, if lending interest rates remain high and the real estate market continues to stagnate, the cash flow will likely remain in the bank.
Applying the 'K coefficient' on land prices may 'miss' many large-scale projects?
Responding to the request of the Ministry of Natural Resources and Environment for comments and completion of the draft Decree amending and supplementing Decree No. 44/2014/ND-CP regulating land prices, the Ho Chi Minh City Real Estate Association (HoREA) said that the regulation on applying the land price adjustment coefficient method (coefficient K) for land plots and land areas to be valued at less than VND 200 billion compared to the land price list is not close to reality.
HoREA Chairman Le Hoang Chau said that the Association has just sent a document to the Prime Minister, the Ministry of Natural Resources and Environment, and the National Assembly's Economic Committee proposing to apply the "land price adjustment coefficient method" to calculate land use fees and land rents for all real estate and urban projects without limiting "land plots with a value calculated according to the land price in the land price list under 200 billion VND."
According to Mr. Chau, Article 4 of the draft Decree amending and supplementing Decree No. 44/2014/ND-CP (Draft Decree No. 44) stipulates 3 methods of land valuation, including: Comparison method, income method, land price adjustment coefficient method, and the draft decree no longer stipulates the "surplus method".
In particular, Clause 3, Article 5 of the draft stipulates that "the land price adjustment coefficient method is applied to determine land prices" in the following cases: Determining the land price of a land plot or land area whose value is calculated according to the land price in the land price list under 200 billion VND.
However, HoREA found that the regulation of applying the "land price adjustment coefficient method" to land plots and land areas that must have a price of "under 200 billion VND" compared to the land price list is not close to reality because it "misses" many real estate projects, housing, and urban areas with larger scales.
“Because there is no suitable method to apply land valuation for the above cases because the draft Decree 44 only stipulates 3 land valuation methods, in which the comparison method or income method cannot be applied to value land to calculate land use fees and land rent for land plots and land areas with a value of over 200 billion VND,” Mr. Chau shared.
Therefore, in Mr. Chau's opinion, the regulation of applying the land price adjustment coefficient method to all projects regardless of "land plots and land areas with a value calculated according to the land price in the land price list of less than 200 billion VND" or "over 200 billion VND" will contribute to ensuring transparency, fairness, and not causing loss of state budget revenue.
Based on the analysis, the Chairman of HoREA emphasized that in order to meet practical requirements and apply the land price adjustment coefficient method to all real estate projects, commercial housing, and urban areas - the draft needs to remove the regulation "under 200 billion VND" to apply the land price adjustment coefficient method to all projects, regardless of "land plots, land areas with value calculated according to land price in the land price list under 200 billion VND" or "over 200 billion VND".
“In case the land price adjustment coefficient method is still applied to land plots and land areas with a value of less than 200 billion VND, it is necessary to retain the surplus method to determine specific land prices and calculate land use fees and land rents for land plots and land areas with development potential; large scale with values calculated according to land prices in the land price list of over 200 billion VND,” Mr. Chau proposed.
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| Article 7 of the 2014 Housing Law clearly stipulates that there are 3 subjects that are allowed to own houses in Vietnam, namely: Domestic organizations, households, and individuals; Vietnamese people residing abroad; Foreign organizations and individuals specified in Clause 1, Article 159 of this Law. (Source: BXD) |
Conditions for recognition of home ownership
Article 8 of the 2014 Housing Law clearly stipulates the conditions for recognition of home ownership rights.
Who is eligible to own a house in Vietnam?
Article 7 of the 2014 Housing Law clearly stipulates that there are 3 subjects that are allowed to own houses in Vietnam, namely: Domestic organizations, households, and individuals; Vietnamese people residing abroad; Foreign organizations and individuals specified in Clause 1, Article 159 of this Law.
Conditions for recognition of home ownership
To be recognized for home ownership, the first condition is that the organization, household, or individual is domestic. For Vietnamese people residing abroad, they must be allowed to enter Vietnam; for foreign organizations and individuals, they must meet the conditions specified in Article 160 of the 2014 Housing Law.
In addition, it is necessary to have legal housing through the following forms: For domestic organizations, households and individuals, it is through the form of investment in construction, purchase, hire-purchase, receiving gifts, receiving inheritance, receiving capital contributions, receiving housing exchange and other forms according to the provisions of law.
For Vietnamese people residing abroad, through the form of purchasing or leasing commercial housing from real estate business enterprises or cooperatives (hereinafter referred to as real estate business enterprises); purchasing, receiving gifts, receiving exchanges, receiving inheritance of housing from households or individuals; receiving transfer of land use rights in commercial housing construction investment projects that are permitted to sell land to self-organize housing construction according to the provisions of law.
For foreign organizations and individuals, it is through the forms prescribed in Clause 2, Article 159 of the 2014 Housing Law.
Vingroup establishes subsidiary with charter capital of over 1,200 billion VND in Nghe An
Vingroup Corporation (stock code: VIC) has just announced a resolution on separating a subsidiary and establishing a new company.
Specifically, Vingroup's Board of Directors approved the separation of Vinpearl Joint Stock Company, a subsidiary of the Group, and the establishment of a new subsidiary, on the basis of the separation of the above enterprise, for the purpose of restructuring internal ownership.
The newly established company is Vinpearl Cua Hoi Joint Stock Company, with its head office located at Binh Minh Street, Nghi Hai Ward, Cua Lo Town, Nghe An Province.
Vinpearl Cua Hoi's expected charter capital is VND1,263.8 billion. Of which, Vingroup's capital contribution ratio is 99.99% of the charter capital. The main business line of this enterprise is hotel and tourism services.
Before separating and establishing a new company, the Nghe An branch of Vinpearl Joint Stock Company was established in 2017. The representative of the branch is Ms. Vo Thi Phuong Thao.
In Nghe An, Vingroup develops real estate projects such as Vinpearl Cua Hoi, Vincom Shophouse Vinh, and the renovation project of area B - Quang Trung apartment complex, Vinh city.
In 2022, Vinpearl Joint Stock Company cooperated with Melía Hotels International Group to announce a strategic cooperation roadmap. Melía Vinpearl Cua Hoi is one of 12 projects that Vinpearl cooperated to transfer management rights to Melía for a minimum period of 10 years.
This resort is a complex of villas and hotels with a scale of 38.7 hectares, including 184 hotel rooms located on an area of 5,000 square meters. The total investment capital of the project is nearly 900 billion VND. The project started construction in June 2016 and was inaugurated in April 2017.
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