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The unusually high winning bid for the land in Hoai Duc district, Hanoi, has caught the attention of the authorities, with the Prime Minister issuing a directive to review and rectify land auction practices. The bid, which reached up to VND 133.3 million per square meter, has raised concerns about its potential impact on socio-economic development, investment, business, and the real estate market.
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On August 26, Hoai Duc district was scheduled to hold another land auction for 20 plots in the Long Khuc area, following the controversial auction of 19 plots on August 19 and 20. The starting price was set at VND 7.3 million per square meter, with plot sizes ranging from 89 to 145 square meters. The deadline for submitting applications was August 23.
However, in light of the recent developments, the land auction for these 20 plots has been temporarily halted to allow for a thorough review and inspection as directed by the Prime Minister’s Office in Official Dispatch No. 82 on August 21, 2024. This directive aims to ensure fair and transparent land auction practices and address any potential irregularities.
Mr. Nguyen Huy Hoang, Director of the Hoai Duc Land Development Center, confirmed that a delegation from the Ministry of Natural Resources and Environment will be inspecting the recent land auction on August 23. He assured that once the inspection is completed and no issues are found, the district will promptly announce a new schedule for the auction of the remaining lots in Long Khuc, Tien Yen.
On August 22, the Chairman of the Hanoi People’s Committee, Mr. Tran Sy Thanh, issued Official Letter No. 2781/UBND-TNMT, instructing relevant departments and units to inspect and address any legal violations related to the abnormally high winning bids for land auctions in the city.
The letter acknowledged that land auction prices in Hanoi have recently surged, with winning bids in Thanh Oai district reaching 7-8 times the starting price and the highest bid in Hoai Duc district being 18 times the starting price. These abnormal bids have the potential to disrupt the real estate market and affect socio-economic development.
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Following the land auction in Thanh Cao commune, Thanh Oai district, on August 10, brokers pushed up the resale price of the lots by up to VND 1 billion per lot, depending on their location. This has raised concerns about the impact of such practices on the real estate market and the wider economy.
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In response, the Hanoi People’s Committee has instructed the Department of Natural Resources and Environment to coordinate with relevant departments to inspect all land auctions in Thanh Oai and Hoai Duc districts and take decisive action against any legal violations.
On August 21, Prime Minister Pham Minh Chinh issued Official Dispatch No. 82/CD-TTg, directing relevant ministries and sectors to review and rectify land auction practices. The dispatch emphasized the need for transparency and the prevention of profiteering and market manipulation.
The Prime Minister has instructed the ministers of Natural Resources and Environment, Justice, Finance, and Construction, along with the chairpeople of provincial and municipal People’s Committees, to urgently inspect and review land auction practices, especially in cases of abnormal bids. Any violations of land auction regulations must be strictly handled, and necessary amendments to the legal framework should be proposed to prevent profiteering.
The Minister of Natural Resources and Environment has been tasked with proposing measures to address profiteering in land auctions and reporting them to the Prime Minister before August 30, 2024. Additionally, the Minister of Construction has been instructed to assess the impact of recent land auction results on the real estate market and propose solutions to mitigate any negative consequences.
The dispatch also emphasizes the importance of detecting and preventing collusion and market manipulation in land auctions. The ministers of Natural Resources and Environment, Construction, and Finance are directed to provide guidance and training to local authorities on the new policies introduced by the amended Land Law, Housing Law, and Law on Real Estate Business.
Deputy Prime Minister Tran Hong Ha has been assigned to directly oversee the implementation of this dispatch, and the Government Office has been requested to regularly report to the Prime Minister and the Deputy Prime Minister on any emerging issues.
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