HoREA proposes new regulations on real estate project deposits

HoREA Chairman Le Hoang Chau said that, regarding the regulations on deposits for purchasing real estate "on paper" or existing, giving two options to choose from may still be inappropriate and the best option is to combine both options into one.

Accordingly, Mr. Chau proposed to combine in the direction: " Project investors are allowed to collect deposits from customers when the houses and construction works have met the conditions for being put into business and have conducted transactions in accordance with regulations in order to ensure contract performance or real estate project investors are only allowed to collect deposits to ensure contract signing according to the agreement with customers when the project has a basic design appraised by a state agency and the investor has one of the documents on land use rights specified in Clause 2, Article 24 of this Law.

The deposit agreement must clearly state the selling price, lease-purchase price of the house or construction work. The maximum deposit amount is according to Government regulations but must not exceed 10% of the selling price, lease-purchase price of the house or construction work, ensuring compliance with the socio-economic development conditions in each period and each type of real estate .

Many regulations have been put in place to regulate deposits for real estate projects. (Illustration: Cong Hieu)

Mr. Chau also analyzed each option in detail. Option 1 is: “ Real estate project investors are only allowed to collect deposits from customers when the houses and construction works have met all the conditions for being put into business and have conducted transactions in accordance with the provisions of this Law .”

With this option, according to Mr. Chau, the purpose of "deposit to ensure contract performance" is that in reality, after the contract has been signed, there are rarely cases where the depositor is "defrauded" by the deposit recipient because the contract is often strictly checked by the parties and implemented in accordance with the provisions of law. And when the contract is executed, the "deposit" is often deducted from the initial payment of the transaction.

Option 2 is: “ Real estate project investors are only allowed to collect deposits according to the agreement with customers when the project has a basic design appraised by a state agency and the investor has one of the documents on land use rights specified in Clause 2, Article 24 of this Law.

According to Mr. Chau, this plan is aimed at "depositing to ensure the signing of the contract". In reality, before signing the contract, the depositor is often "defrauded" by the deposit recipient and does not perform the "contract", causing damage to the depositor.

“ Currently, both “option 1” and “option 2” are correct, so it is necessary to integrate both options into one, regulating “deposit” to “guarantee contract signing” or “deposit” to “guarantee contract performance” to protect the legitimate rights and interests of customers who buy, lease-purchase real estate, available housing or housing in the future ”, Mr. Chau emphasized.

Mr. Chau also assessed that the Real Estate Business Law 2006 and 2014 do not regulate "deposits" occurring before the time when the real estate project or housing is eligible to enter into a contract or mobilize capital to sell future housing, especially land.

Therefore, there is a situation where "speculators, land brokers, dishonest businesses" take advantage of Clause 1, Article 328 of the 2015 Civil Code which does not stipulate the value and rate of "deposit", so they receive "deposits" from customers with large values, in some cases up to 90-95% of the value of the transaction property.

Even the "speculators, land brokers, and dishonest businesses" have set up "ghost projects" without legal basis for the purpose of fraud, causing huge losses to customers and causing social disorder, typically the fraud case that occurred at Alibaba Company.

Chau Anh

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