Beneficial for Home Buyers

According to the draft decree on the administration and development of social housing, sellers of social housing apartments will be exempt from paying a land use charge after five years, however developers who resale this kind of property after 10 years of lease would be required to pay the cost.

This is a new point compared to the existing regulations under Decree 100/2015/ND-CP: When selling a social housing flat, the seller must pay 50% of the land usage charge to the state budget. When selling low-rise social housing, the seller is responsible for paying the whole land use charge.

Deputy Prime Minister Trần Hồng Hà chaired the meeting on the draft decree on the administration and development of social housing, highlighting it as a significant adjustment to the updated Housing Law of 2023.

Deputy Prime Minister Trần Hồng Hà has asked ministries and sectors to thoroughly scrutinize sales of social housing units in distant locations. This is because, if this legislation is implemented, ethnic minorities and mountainous dwellers would be required to pay a land-use tax. According to him, the goal of this evaluation is to safeguard people's rights in challenging places.

Furthermore, with regard to the development of social housing by commercial housing project developers, many suggest allowing developers to propose implementing a portion of the area, arranging alternative land, or paying an equivalent amount to the land fund invested in building technical infrastructure to construct social housing at a minimum ratio of 20%.

Dương Đức Tuấn, Deputy Chairman of Hanoi People's Committee, proposed that commercial housing developers pay into the budget an amount equal to the value of the land money spent in creating technical infrastructure for social housing.

Deputy Chairman of Quang Binh Province People's Committee, Phan Phong Phú, suggested adding material to encourage commercial housing developers in urban development projects to designate budget for investing in social housing on assigned land, rather than paying into the budget.

The Deputy Prime Minister requested that the Ministry of Construction work with the Ministry of Finance and the State Bank to establish a coherent and targeted approach to mobilizing resources for social housing projects. In this regard, the state budget, as well as contributions to the development of social housing from commercial housing project developers and other social sources, play an important role, without putting commercial banks under financial strain when participating in social housing loan packages.

Important Premise for Housing 

Previously, the National Assembly decided to pass the Land Law, Housing Law, and Real Estate Business Law effective on August 1, 2024. According to experts, this serves as an important basis for the growth of the real estate market, as the recent changes to the Housing Law assist the national housing development strategy achieve its goals more quickly.

According to the Ministry of Construction, the Real Estate Business Law and Housing Law would effectively institutionalize the Party's instructions and the state's legislative policies for developing and administering the real estate sector. It also assures that the real estate market is stable, transparent, and open.

Mr. Nguyễn Văn Đính, Chairman of VARS, feels that the upcoming new rules would assist address obstacles for some real estate projects, increasing supply and stabilizing the market. However, many projects will need to repeat procedures such as bidding, auctioning, or poor planning.

Furthermore, policies encouraging the development of affordable commercial housing and social housing will thereby promote projects further. "Real estate will grow better when the laws take effect early, but the market will not 'explode' but will develop steadily. Better control, investment business activities, and brokerage services are also managed more tightly... helping the market be transparent, fair, and sustainable," Mr. Đính observes.