Limited-term housing will be granted pink books

Open the market

Specifically, the Housing Law 2023, which has just been passed by the National Assembly, stipulates: In the case of a limited-term housing purchase, the home buyer is granted a certificate (pink book) within the agreed ownership period. When the housing ownership period expires, the ownership of the home is transferred to the owner who sold the home as agreed in the contract. In the case that the seller does not receive the home after the ownership period expires, the matter will be resolved according to the provisions of Article 166 of this Law and other relevant legal provisions. In addition, the Housing Law 2023 also stipulates that the parties may agree that the seller will sell the home within a certain period of time to the buyer. In the case of a housing purchase and sale transaction with an agreement on the ownership period, the competent authority issuing the pink book must clearly state the housing ownership period in the pink book.

With the new regulations of the Housing Law 2023, not only condotels but also officetels and serviced apartments will be granted pink books.

Mr. Nguyen Tien Dung, General Director of Savista Company, analyzed that in April 2023, Decree 10 was issued, allowing condotel apartments nationwide to be granted pink books. However, since then, very few projects have been granted pink books. Meanwhile, officetel apartments and service apartments are not granted pink books. Up to now, when the Housing Law 2023 was passed by the National Assembly, it has covered all types of real estate projects with a time limit for granting pink books and will help unblock the bottleneck in the market because previously, customers who bought these types of apartments were not granted pink books, so transactions were blocked. "This is a new and very welcome point because it solves many bottlenecks for the market, while ensuring the rights of owners in conducting transactions of buying, selling, transferring mortgages, and leasing apartments without having to go through investors... The regulations put into practice will help clear the way and contribute to reheating transactions in the market of resort real estate, office apartments, and serviced apartments," said Mr. Dung.

The leader of a resort real estate enterprise in Binh Thuan expressed his joy when the type of real estate with a term was legalized for the issuance of pink books, especially resort real estate which is being invested in by many enterprises from North to South. Because for a long time, resort real estate has been considered a "hybrid child", the state allows enterprises to invest and buy and sell but is not granted a "birth certificate" which is a pink book. This has affected not only enterprises but also home buyers. Because the book is not granted, many cases cannot be mortgaged to banks, the state also loses tax revenue. "Currently, the market is still difficult, in which resort real estate is even more difficult. So with this new policy, it is expected to help customers feel more secure when buying a house. From there, it can help the market recover sooner than expected", he expected.

Expectations to help reduce prices

According to architect Tran Tuan, because they are flourishing but are not granted pink books, a new type of mini apartment has appeared on the market. These are essentially serviced apartments, the owners of these buildings often sell or lease long-term with handwritten sales contracts. Many people are willing to spend money to buy them because their low incomes do not have enough money to buy townhouses or apartments. Because they are not strictly managed, it has led to many consequences, the most recent of which is the mini apartment fire in Hanoi. Now that this type of apartment is recognized and managed, it will help it return to its true nature, helping low-income people buy cheap but safe houses.

Mr. Le Hoang Chau, Chairman of the Ho Chi Minh City Real Estate Association, welcomed the 2023 Housing Law for inheriting the regulations on limited-term housing ownership of the 2014 Housing Law to meet the needs of a segment of consumers who only want to buy and own housing for a certain period of time. The regulations on limited-term housing ownership also contribute to the development of limited-term housing such as serviced apartments built on land with a maximum land use term of 50 years with a lower selling price than the selling price of apartments with indefinite ownership. Mr. Le Hoang Chau gave an example: Project B on Nguyen Huu Canh Street (Binh Thanh District, Ho Chi Minh City) includes Area 1, a high-end apartment building built on stable, long-term residential land that apartment buyers can own for an indefinite period of time. Area 2 is an office area for rent, serviced apartments are built on land with a 50-year term of use, and the buyer of the serviced apartment will own it for 50 years and the selling price will be lower than Area 1. At that time, customers will have more choices and also feel secure because the apartment they buy, whether long-term or limited-term ownership, will be granted a pink book and will be protected by law.

Or the case of Mr. A having a plot of land for Mr. B to lease for 20 years. Mr. B is allowed to invest in building an apartment building to sell apartments with a limited ownership term to customers. Mr. B spends 1 year to build and sell the apartment to customers who own it for 19 years at a lower price than the price of the same type of apartment with an indefinite ownership term. After 20 years, the customers return the apartment to Mr. B and Mr. B demolishes the building to return the land plot to Mr. A. Another example is Mr. C selling his house to Mr. D for a 20-year ownership term, also at a lower price than the outright sale price. "The above cases of buying houses with a limited ownership term are all granted a limited-term pink book and are handled according to the provisions of the Housing Law, which will promote the strong, healthy and safe development of the real estate market in many segments. This will also create competition, helping to reduce real estate prices," Mr. Chau analyzed.

Once legalized, businesses will also boldly invest in this segment. This will help the market have more apartment supply, thereby competing with long-term ownership apartments and possibly creating a price revolution.

Architect Tran Tuan

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