The National Assembly’s Economic Committee on April 10 met for the last time with the Construction Ministry to evaluate the housing policy for foreigners in Vietnam. One new point has been added: foreigners are permitted to own an apartment for 70 years.
This policy, which is considered very open, was supported by attendees. Most of delegates say this policy is necessary and appropriate to Vietnam’s renovation policy, and can encourage foreign investment in Vietnam.
Under this policy, foreigners are allowed to buy one apartment only and to sell the apartment one year after the day they receive the apartment ownership certificate.
According to the Construction Ministry, this regulation is to restrict foreigners from abusing this policy to make money.
Some members of the NA’s Economic Committee proposed to allow foreigners to sell their apartments 2-3 years after they receive ownership certificate to avoid speculation.
Discussing the possible impacts of this policy on the real estate market, Head of the Housing Management Agency Nguyen Manh Ha said if the new policy is approved, the supply of apartments, especially high-class ones, will be insufficient in the initial period.
However, the number of foreigners who meet conditions to own apartments in Vietnam is around 10,000 only.
According to the Construction Ministry, there are around 25,000 foreigners working for investment projects in Vietnam and 55,000 others are working in the fields of health, education, culture-sports, science and technology, etc.
Hanoi currently has 1,300 houses and apartments totalling around 220,000sq.m hired by foreigners, at average charges of $700 to 1,000/house/ per month.
In HCM City, there are 4,000 houses and apartments hired by foreigners, totalling around 660,000sq.m, which are mainly located in Phu My Hung residential area, Districts 1, 3 and 5, ranging from $1,000-2,000/house/month and up to $2,000 to 3,000/house/month in central areas.
The National Assembly will vote on this plan during its 3rd session, which will open on May 6, 2008.
Under this plan, there are seven subjects of foreigners who are permitted to buy apartments in Vietnam: chiefs of foreign representative agencies and international organisations in Vietnam; foreign investors; foreigners who receive medals from the Vietnamese government; cultural experts and scientists who are working in Vietnam; foreigners who marry Vietnamese citizens and live in Vietnam; foreigners who are recognised as honoured Vietnamese citizens by the Vietnamese President; and foreign-owned companies that don’t operate in real estate.
So far, under the Investment Law, Housing Law and the Law on Real Estate Business, foreign individuals and organisations are permitted to hire land in Vietnam, to invest in building houses to use or for lease, and even repair and upgrade houses, etc.
Thus, foreigners have the right to participate in most housing investment activities, except for buying houses to use, to sell, to lease or hire houses to lease again.
According to the Housing Law 2005, foreign firms are allowed to own for a certain period of time the houses that they invest in for lease. However, this right is not given to foreign individuals who take part in housing investment projects, scientists, experts, etc.