According to the Ministry of Construction's latest list released, there are 179 foreigners and 667 overseas Vietnamese who own houses in Vietnam are granted home-ownership certificates (commonly known as red books).
Lawyer Nguyen Thanh Ha, Chairman of S&B Law Firm said that this number is the most realistic reflection of the restrictions on the implementation of open policies for foreigners to invest in or own any real estate in Vietnam recently.
The amended 2014 Housing Law has expanded the ownership, type of houses as well as the ownership duration for the foreigners, except some special cases. Thereby, more and more foreigners are confident in buying houses in Viet Nam.
According to unofficial statistics, the number of foreigners owning houses within two years since the amended 2014 housing law came into force are 10 times higher than those 10 years ago.
However, regardless of foreigners or Vietnamese, the demand for home-ownership certificates is always the top priority because it proves the legal rights and responsibilities for the owners. There are possibly many reasons why thousands of foreigners and overseas Vietnamese, who are owning houses, but few of them are granted red books.
Ha said that the process and procedures are not really "open" as expected. There are certain "forbidden lands" where guidelines are not clear and sufficient enough for competent authorities such as the Department of Construction and Department of Natural Resources and Environment to grant red book to foreigners.
Another outstanding issue related to the ownership duration has remained unresolved in the amended 2014 Housing Law and its guiding documents. Specially, if a foreigner wants to sell a house under his or her ownership, how long will the buyer own the house? If the buyer is a foreigner or overseas Vietnamese, will he/she own the house for 50 years or the remaining duration of the previous owner; If the buyer is a Vietnamese, will they own this house permanently?
Furthermore, pursuant to Articles 7 and 159 of the amended 2014 Housing Law, subjects eligible for the home-ownership in Vietnam include overseas Vietnamese and foreign organizations and individuals .
However, the 2013 Land Law does not stipulate that foreign individuals are the land users. Decree No. 99/2015, which replaces Decree No. 51/2009, does not stipulate the land use rights of foreign individuals in case of home-ownership, either.
These shortcomings discourage foreigners from purchasing houses in Viet Nam.
Recently, Prime Minister Nguyen Xuan Phuc has requested to revise the draft Law on special administrative-economic zones towards increasing the duration of allocation, lease and use of land, which allows foreigners to own houses for maximum 99 years. The Government’s move is to attract foreign investors’ attention to the real estate market in Viet Nam.
However, in order to make the real estate market in Viet Nam more attractive to the foreigners, these shortcomings above should be solved sooner.