Housing supply will improve
In early January 2024, the National Assembly passed the Land Law (amended), which is considered an important turning point for the Vietnamese real estate market. Many laws, when applied, are expected to create a transparent real estate market, making it easier for people to learn about buying real estate, avoiding the situation of "inflating and blowing up" real estate bubbles.
Speaking with Nguoi Dua Tin , Mr. Pham Anh Khoi, Director of the Dat Xanh Services Real Estate Economic and Financial Research Institute, said: “The passage of the 2024 Land Law and the Law on Credit Institutions contributes to perfecting the institutional framework for the real estate industry.
The real estate market is expected to develop more systematically and carefully in the coming time.
“The passage of the Land Law (amended), together with the Housing Law (amended), and the Real Estate Business Law (amended), has met the requirements for synchronous completion of policies and laws on land management and use in accordance with the institutional development of the market economy, so that land resources are managed, exploited, and used economically, sustainably, and with the highest efficiency.
This also meets the requirements of promoting industrialization, modernization, social equity and stability; ensuring national defense and security; protecting the environment, adapting to climate change; creating momentum to turn our country into a developed country with high income," Mr. Khoi commented.
Solving land fund and developing social housing projects is considered to be very prominent and create supply for the market. Helping many people with real housing needs to access real estate more easily.
People, real home buyers will benefit
According to experts, many new points of the law are assessed to be favorable for people, remove difficulties for businesses, increase supply to the market at more reasonable prices. Thereby, contributing to limiting speculation, price inflation, and affecting the real estate market.
“If the new law is applied early (specifically from July 1, 2024), it is predicted that the quality of real estate projects will also be improved thanks to many stricter regulations on handover standards, progress, etc. For example, Article 36 of the 2023 Housing Law stipulates that investors must have the capacity and experience to implement the project, must not authorize/assign other partners to sign the contract, and can only transfer land after completing and accepting the technical infrastructure system for use, and must ensure the progress of the registered phases,” said Mr. Pham Anh Khoi, Director of the Dat Xanh Services Real Estate Economic and Financial Research Institute.
The new land law will be applied, forcing investors to prepare enough resources and complete legal procedures before offering to the market, avoiding "catching thieves with bare hands" and inflating real estate prices.
According to experts, the new regulations force investors to be disciplined in project development, so consumers generally benefit from the changes in the law. The two groups that benefit the most are overseas Vietnamese and those who are resettled/received compensation.
According to statistics, about 15-20% of remittances are invested directly in real estate. Changes in the law create a more formal legal framework and more flexible policies, stipulating that overseas Vietnamese are allowed to transfer land use rights (previously only leased, authorized to manage unused houses). This will further expand opportunities to attract foreign capital into the real estate market.
People who are subject to resettlement/compensation are also guaranteed rights in many cases. Households and individuals subject to resettlement are given opportunities to have jobs, earn income, stabilize their lives and production.
People whose land is subject to clearance will also benefit more fairly, and land compensation prices will depend on each area to determine.
The 2024 Land Law also stipulates that resettlement areas must complete technical and social infrastructure conditions to ensure the lives of residents. For households and individuals who are compensated when their land is recovered, in cases where they do not meet the conditions for receiving residential land but cannot be arranged for other accommodation, they will still be compensated for residential land. Subjects whose non-agricultural land (not residential land) is recovered will also be compensated for land more flexibly than before.
Mr. Ngo Quang Phuc, General Director of Phu Dong Group, commented: “The application of the revised land law will really help make the real estate market transparent. Investors are forced to do the right thing and follow all legal procedures before reaching consumers.
Besides, in cases where people are subject to land clearance, land prices are determined according to market prices... This will certainly help land clearance to be faster and more convenient."
However, according to experts, when the law is applied and compensation prices in some projects increase and there are stricter requirements for investors regarding business conditions, capital ratios, and resettlement procedures, it will lead to an increase in prices of private houses and other types of real estate.
Therefore, home buyers and those with real housing needs should also consider the timing and choose to buy real estate products that suit their financial capacity.
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