The Real Estate Business Law and the Housing Law, both passed by the National Assembly at its November 2023 session, will take effect from January 1, 2025. According to a draft resolution recently released by the Ministry of Justice, the Government has proposed that these two laws come into effect 6 months earlier.
According to the Ministry of Construction, the Housing Law includes many new contents of significant innovation that contribute to the goal of perfecting institutions and policies, and improving the effectiveness of housing management and development.
The fact that these two laws come into effect 6 months early also aims to ensure they coincide with the Land Law 2024, which is also being submitted to the Government for the National Assembly to approve for it to come into effect from July 1.
According to experts, the three most important laws affecting the real estate market are the Land Law, the Housing Law, and the Real Estate Business Law, which have already been passed. These are considered the fundamental basis for contributing to the market developing in a safe and healthy direction. Once officially effective, these three laws will have the following impacts on the real estate market.
Changes and impacts of the Real Estate Business Law
First: Brokers will not be allowed to operate independently but must join a trading floor or a real estate services business enterprise
Impact:
For the general market: Increase control, help the market to be “more orderly”. Thereby, minimize confusion and factors that could cause trouble.
For customers: Increase the level of security with transactions through brokers.
For the State: Increase the state budget, avoiding tax evasion from personal income of real estate brokers.
Second: All income of brokers must be paid through transfer
Impact: Helps increase the state budget and avoid losses.
Third: Real estate information must be made public before being put into business.
Impact: Ensure the publicity and transparency of the market. Avoid imbalances in information. Help subjects who need information to access it quickly and accurately.
Fourth: Record the actual transaction price in the contract
Impact:
For the State: Increase state budget, avoid tax evasion.
For management agencies: They will have sufficient, accurate sources of information and data to serve the management and administration work to ensure the closest alignment with the actual market situation, especially with decisions related to prices.
Fifth: Prohibit the subdivision and sale of special-type, type I, II, III urban land
Impact: Ensure general planning and landscape, but limit supply in the short term.
Sixth: Before handing over future residential houses, investors are only allowed to collect a maximum of 50% of the HĐMB value instead of 70% as present
Impact:
For homebuyers: Reduce financial pressure while minimizing risks when buying future residential houses.
For investors: Revenue from customers is one of the important capital attraction channels for investors. Before this regulation, the source of capital from customers will be reduced, requiring investors to proactively seek and arrange capital sources from other channels to ensure the implementation of the project.
In addition, there are several other changes in the Real Estate Business Law that will come into effect from July 1. Specifically, individuals doing small-scale real estate business are not required to establish a company, which helps simplify for individuals with small-scale real estate who want to do business.
The regulation on real estate business companies only requires 1 person with a brokerage certificate instead of 2 people as present. According to the Vietnam Real Estate Brokers Association, in essence this creates conditions and simplifies procedures for real estate business companies. However, in the context of the market increasingly demanding more and more from the real estate brokerage force, this regulation has not really helped raise awareness of the need to equip themselves with knowledge and participate in professional practice certificate exams for real estate brokers.
The new regulations of the Real Estate Business Law will eliminate many non-professional real estate brokers, creating a healthy and transparent real estate business environment.
Changes and impacts of the Housing Law
First: Regulations on mini apartments
Content 1: must meet all standards for fire prevention and fighting, which contributes to ensuring safety and social welfare for people.
Content 2: Consider granting a pink book if meeting sufficient conditions, creating opportunities for people to access housing, especially for the low-income group to own houses.
Second: No规定on the time limit for owning an apartment
This regulation creates peace of mind for those who own apartments. It contributes to promoting the development of this segment, given the context of increasingly scarce land funds, especially in the center of large cities where population density is high.
Third: Run-down apartment buildings, forced to relocate but people living there do not relocate will be subject to compulsion .
This ensures safety and social security. Create conditions for the relocation work to be smooth.
Fourth, Vietnamese people living abroad have the right to own houses attached to land use rights , increasing demand for real estate products, promoting the development of the market by attracting a high-paying target group.
According to experts, the real estate market in 2024 will filter out investors with poor finances and weak resources. Only investors with many good things: good finances, good products, good law, … will have a seat in the new “play field” of real estate. New real estate projects must be completed in accordance with the planning and design in order to be sold or rented out. With increasing scale and quality, as well as services and infrastructure being increasingly upgraded.
