Many projects are "shelved", National Assembly deputies propose to only collect deposits when business conditions are met

Video : Opinions of National Assembly deputies on the amended Law on Real Estate Business on the morning of October 31st. (Source: quochoi.vn)

Specifically, during the discussion in the National Assembly on the amended Law on Real Estate Business on the morning of October 31st, delegate Tran Hong Nguyen ( Binh Thuan delegation) expressed his agreement with the proposal that "Real estate project developers are only allowed to collect deposits from customers when the housing or construction project has met all the conditions for being put into business and has conducted transactions in accordance with the provisions of this Law."

According to Ms. Nguyen, this option is less risky for customers, who are the weaker party in real estate transactions, because the deposit is only made when the property is eligible for business and both parties have officially signed the contract, limiting the possibility of disputes.

Representative Tran Hong Nguyen – Member of the National Assembly delegation from Binh Thuan province. (Photo: quochoi.vn).

Ms. Nguyen also commented on Option 2: “Real estate project developers are only allowed to collect deposits as agreed with customers when the project's basic design has been appraised by a state agency and the developer possesses one of the land use right documents stipulated in Clause 2, Article 24 of this Law. The deposit agreement must clearly state the selling price or lease-purchase price of the house or construction project. The maximum deposit amount is regulated by the Government but shall not exceed 10% of the selling price or lease-purchase price of the house or construction project, ensuring it is consistent with the socio -economic development conditions in each period and for each type of real estate.”

Ms. Nguyen stated her opinion: Collecting deposits right from the time the project's basic design is appraised by the State agency and the investor possesses one of the land use right documents as shown in option two will lead to a very long time between receiving the deposit and actually implementing the project, creating more risks for customers.

Meanwhile, the real estate market has recently experienced many complex developments, with developers of real estate projects still exploiting deposit agreements and capital contribution contracts to arbitrarily raise capital, causing a disruption to public order and security.

" The reality shows that many projects, after receiving deposits, remain unimplemented even after 5 or 10 years. Therefore, the representative believes that regulations are needed to more strictly control and limit this situation from occurring... ", Ms. Nguyen emphasized.

Meanwhile, delegate Nguyen Dai Thang (Hung Yen) chose option 2.

The delegates explained that this proposal clearly defines the circumstances under which developers are allowed to collect deposits as agreed with customers; it clarifies the content of deposit agreements and the deposit amount, ensuring transparency and protecting the legitimate rights and interests of organizations and individuals who have signed contracts for the purchase or lease of housing or construction projects; and it limits real estate businesses from using deposits as a means of raising capital.

Mr. Thang also suggested that the drafting agency should research and clearly define the conditions for housing and construction projects under construction. Accordingly, permission should only be granted for investors to sell housing under construction in areas where the project components have met the conditions of having approved designs for essential infrastructure projects that have been completed according to schedule.

At the same time, clarify the meaning of "requirement to complete in accordance with the project schedule".

On the morning of October 31st, the National Assembly discussed the amended Law on Real Estate Business. Photo: (quoc hoi.vn).

In addition, delegate Thang also suggested that the drafting agency should clearly decide on the responsibility for building, updating, managing and exploiting the database on housing and real estate market, publicly announcing information on housing and real estate market in the housing and real estate market information system; connecting, sharing, and providing information and data on housing and real estate market to agencies and organizations according to the provisions of law is the responsibility of the Ministry of Construction.

Sharing the same view as Representative Thang, Representative Nguyen Thi Viet Nga (Hai Duong) also supported choosing option 2.

Delegates argued that such regulations would create more favorable conditions for businesses and investors to develop, especially in the context of real estate businesses facing many difficulties.

Investing in a project requires significant funding, so allowing the developer to collect deposits early will help them secure additional capital for reinvestment, thereby increasing opportunities and attracting potential customers.

" Although this regulatory approach may pose more risks to customers, the representative emphasized that this needs to be addressed by tightening management and enhancing the accountability of competent state management agencies."

"In particular, right from the initial investor selection stage, it is crucial to ensure the investor's capacity and ability to execute the project. Limiting risks, as in Option 1, which only allows real estate project developers to collect deposits when the housing or construction project meets the conditions for business operation, will restrict business opportunities and contradict the goal of encouraging and creating mechanisms for business development ," the representative expressed.

The proposed deposit amount should not exceed 5% of the selling price.
Representative Huynh Thi Phuc (National Assembly Delegation of Ba Ria - Vung Tau province) stated that, after consulting with the Real Estate Association and conducting a field survey, a 5% deposit is considered a reasonable amount according to common practice.
The delegate proposed amending Clause 5 of Article 23 as follows: “ The investor of a real estate project may only collect a deposit as agreed with the customer when the project has a basic design that has been appraised by a state agency and the investor possesses one of the land use right documents specified in Clause 2 of Article 24 of this Law.”
The deposit agreement must clearly state the selling or renting price of the house or construction project; the maximum deposit amount is as stipulated by the Government but shall not exceed 5% of the selling or renting price of the house or construction project, ensuring it is consistent with the socio-economic development conditions in each period .”

Ngoc Vy

Source