The number of foreigners buying real estate products in Vietnam has increased, but the domestic property market needs policies to attract more foreign investment. (Photo: cafef.vn)Hanoi (VNA) – The number of foreigners buying real estate productsin Vietnam has increased, but the domestic property market needs policies toattract more foreign investment, according to experts.
Nguyen Trong Ninh, Director of the Housing and Real Estate Market ManagementDepartment under the Ministry of Construction, said a policy on licensingforeigners buying and owning houses in Vietnam was issued in 2008.
In 2014, the Ministry of Construction reviewed and evaluated this policy duringits study of the amendment of the Law on Housing.
According to the ministry, from 2008 to 2014, some 126 foreigners ownedproperty products in Vietnam. Therefore, it proposed to add conditions forforeigners to buy houses in Vietnam. The amended Law on Housing 2014 includingthose proposals was passed in 2014 and came into effect in 2015, Ninh said.
Following two years of implementing the amended Law on Housing, the domesticproperty market has developed in the positive direction in the segment ofselling real estate products to foreign buyers, and foreigners have supportedthe proposals, according to reports from localities sent to the constructionministry.
From 2015 until now, some 750 foreigners received housing ownershipcertificates, six times higher than the period from 2008 to 2014.
However, there are not many transactions involving foreigners buying propertyproducts in Vietnam due to many reasons, including financial ability offoreigners, their jobs in Vietnam, demand, location and price of houses,according to Ninh.
As a state management agency in the field of housing, the Ministry ofConstruction said in the current period, regulations on housing and policiesrelated to housing in Vietnam for foreign individuals and organisations hadbeen open, including subject, conditions on ownership and the number of housesthat can be owned by foreign buyers.
Meanwhile, regulations on the number of houses that foreign organisations andindividuals can own in buildings and housing projects are in accordance withthe actual conditions of Vietnam and international regulations.
Nguyen Khanh Duy, Savills Vietnam’s HCM City residential sales director, said alimit on the number of apartments owned by foreigners was very important tominimise and prevent negative impact on domestic socio-economic development.
Vietnam’s Circular 19/2016/TT-BXD and Decree 99/2015/ND-CP regulate the numberof houses owned by foreigners to tighten procedures on re-sale of real estateproducts and increase transparency in the process of implementingadministrative procedures for these property products.
However, Duy said an adjustment that will create suitable quotas for certainkinds of property products, such as resorts or Grade A apartments, should alsobe considered carefully. The State should have flexible quotas to create apositive dynamic for the local property market because Vietnam has 82,000foreigners working and living here and more than four million overseasVietnamese, who have high demand for buying housing products in Vietnam
According to Savills Vietnam, the 2015 amendment of the Law on Housing allowingforeigners to buy houses in Vietnam was considered a positive change in policy.That action has promoted further development of the local real estate market.
It was expected to create more favourable conditions in stimulating developmentof investment, tourism and service in the real estate sector.
In fact, property projects and products attracting foreigners have been mainlyin the high-end segment.
Markets attracting foreign buyers include HCM City, Hanoi and Da Nang,according to Savills Vietnam. However, there are a small number of red books orland use rights certificates that were licensed to foreign organisations andindividuals buying houses in Vietnam.
The number is lower in comparison with the high demand from foreign buyersbecause foreigners are not yet clear about legal procedures in Vietnam, while Stateadministrative offices in some localities are not familiar with regulationrelated to foreigners.
For large investors, to find suitable property projects, they often choose towork with an international consulting firm that has a network of offices andbranches in many countries to ensure that all questions related to legal andtrading procedures will be explained satisfactorily. Sometimes, they do notneed to pay more money for consulting services.
The big investors will choose a company with experience, reputation and abilityto communicate well in many languages to save time and money.
However, in terms of customers, these investors should have specificrequirements on the project to get the most detailed consultation information,Duy said.-VNA
VNA
