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The Curious Case of Land Record Files: When Will the People’s Concerns be Addressed?

20 August, 2024

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Gradual Land Price Adjustments to Avoid Shock

This afternoon (August 20), the Ho Chi Minh City People’s Council coordinated with the City People’s Committee to hold a conference consulting delegates on the draft decision to adjust the 2020 land price framework.

Speaking at the conference, many deputies of the People’s Council expressed their concerns.

According to Deputy Cao Thanh Binh, voters disagree because the proposed land price adjustment is too sudden and the price increase is high. This deputy recommended that the city continue using the 2020 land price framework and the latest land price adjustment coefficient (K coefficient) from now until the end of 2025. After that, the city will apply the new land price framework according to the 2024 Land Law.

In addition, Deputy Binh is concerned about the upcoming conversion of about 110,000 hectares of land in Ho Chi Minh City for other purposes.

“What will be the impact and consequences if the land price framework is adjusted?” – Mr. Binh asked.

Deputy Tran Van Bay speaks at the conference. Photo: Ho Van

Meanwhile, Deputy Tran Van Bay – Chief Inspector of Ho Chi Minh City – assessed that the adjustment of the 2020 land price framework has a legal basis and is necessary to keep up with the actual land prices in the region. The 2024 Land Law no longer stipulates the K coefficient, with the sole basis being the land price framework.

“The old land prices were already low, and if we don’t multiply them by the K coefficient, they will be even lower. Meanwhile, the adjusted land price framework has updated the land prices of more than 500 roads that were not included in the old price list. Adjustment is inevitable but needs to be done gradually to avoid shocking the people,” said Deputy Bay.

Deputy Nguyen Thi Thanh Van expressed concern about the authorities’ temporary suspension of resolving people’s land-related dossiers during the waiting period for the land price framework adjustment. Photo: Ho Van

Deputy Nguyen Thi Thanh Van – Head of the Urban Affairs Committee of the People’s Council – said that since August 1, when the 2024 Land Law took effect, many people have submitted administrative dossiers related to procedures for land use right certificates and land use purpose conversion, but the authorities have only received them without processing.

“The 2024 Land Law still allows the application of the old land price framework until the end of 2025. Is the suspension of processing land-related dossiers received after August 1 by the Ho Chi Minh City authorities in accordance with the law or not? We request that the Ho Chi Minh City People’s Committee look into resolving this issue as it seriously affects the rights and interests of the people,” said Deputy Thanh Van.

According to Deputy Tran Quang Thang, many voters believe that the adjusted land price framework will significantly impact real estate businesses. When land prices are high, i.e., high input costs, housing prices also increase, affecting homebuyers.

Curbing Land Speculation

Regarding the adjusted land price framework, Mr. Nguyen Toan Thang – Director of the Department of Natural Resources and Environment of Ho Chi Minh City – said that the unit has developed the draft through a 7-step process. As per the assigned responsibilities, the Department has completed 3/7 steps so far. The remaining steps will be implemented upon receiving the appraisal and approval of the competent authorities.

During this process, the Department has collected opinions from 15 departments, branches, the People’s Committees of 22 districts, Thu Duc City, the Vietnam Fatherland Front Committee, and the Ho Chi Minh City Real Estate Association.

Director of the Department of Natural Resources and Environment of Ho Chi Minh City reports on the draft adjustment of the land price framework at the consultation session. Photo: Ho Van

Mr. Thang said that one of the new points of the 2024 Land Law is to improve the mechanism for determining land prices based on market principles and remove the provisions on the land price framework. The land price framework will now be issued periodically every year instead of every five years as before.

The adjusted land price framework being drafted by the Department of Natural Resources and Environment will affect the determination of financial obligations when implementing five administrative procedures related to land use and assets attached to land. In addition, it will also impact the determination of tax rates, fees, and penalties.

According to Mr. Thang, the adjusted land price framework will also affect cases of administrative sanctions in the field of land and compensation to the State for causing damage in land management and use. However, with the increase in illegal profits to be returned and compensation, the adjusted land price framework will help curb land speculation and delayed land use.

Speaking at the conclusion of the conference, Mr. Bui Xuan Cuong – Vice Chairman of the Ho Chi Minh City People’s Committee – said that he acknowledged all the opinions of the deputies and would continue to direct the drafting agency to complete the adjusted land price framework before submitting it to the Ho Chi Minh City People’s Council for approval. This adjustment is a transitional step towards applying the new land price framework from January 1, 2026.

Regarding the direction of resolving administrative procedures related to land for people who submitted their dossiers after August 1, according to Mr. Cuong, not only Ho Chi Minh City but also other localities are facing similar difficulties. On August 17, the Ho Chi Minh City People’s Committee sent a document to the Prime Minister requesting guidance from the Ministry of Natural Resources and Environment and the Ministry of Finance.

On August 17, the Ho Chi Minh City People’s Committee sent a document to the Prime Minister, proposing guidance on financial obligations related to land for dossiers submitted from August 1 until the new land price framework takes effect on February 1, 2026, in accordance with the 2024 Land Law.

According to the Ho Chi Minh City People’s Committee, before August 1, land prices in the city were applied according to the 2020 land price framework. However, this framework was limited by the land price corridor, resulting in the highest land price being only VND 162 million/sqm.

In recent years, the old land price framework has become outdated and no longer reflects the actual land prices in Ho Chi Minh City. Therefore, every year, the city People’s Committee submits the K coefficient for approval by the People’s Council for application to different subjects, areas, and land use purposes.

Since August 1, with the 2024 Land Law coming into force, the K coefficient is no longer applicable. As a result, it is not possible to multiply the old land prices by the 2024 K coefficient to calculate the new land prices. Due to this difficulty, the Ho Chi Minh City People’s Committee recognizes the necessity of adjusting the 2020 land price framework to gradually align with market prices.

Currently, the draft decision on adjusting the land price framework is being consulted by the Ho Chi Minh City People’s Committee with relevant agencies, organizations, and land users, following the procedure for building legal documents.

During this transition period, to avoid stagnation in handling dossiers related to financial obligations for land from August 1, 2024, to February 1, 2026, when the new land price framework takes effect, the Ho Chi Minh City People’s Committee has proposed that the Prime Minister direct the Ministry of Natural Resources and Environment and the Ministry of Finance to provide guidance.

Anh Phuong – Ho Van