The Hanoi People’s Committee has recently issued a document to the departments, sectors, districts, counties, and townships regarding land-use rights auction work.
The directive instructs units to continue improving regulations, emphasizing the limitation of organizing auctions to allocate land for individuals to build their own houses. It prioritizes auctions that collect land use fees or rent land to organizations as project investors. This aims to ensure the selection of capable investors, contributing to more efficient land use.
Notably, the Hanoi People’s Committee requests the district-level People’s Committees to establish a list of cases where individuals bid significantly higher than the market price and are then unable to make the required payments, disrupting the market.
This list will be publicized on the websites of the districts and the Department of Natural Resources and Environment, ensuring transparency and accountability.
Hanoi also proposes that the city’s police force employ professional measures to promptly detect any violations related to land auctions. Additionally, they are to guide the People’s Committees of the districts, counties, and townships in implementing measures to prevent individuals with a history of auction-related violations from participating in future auctions.
The police are also expected to suggest solutions to prevent or restrict the participation of those who repeatedly bid abnormally high amounts and then back out from future auctions.
A land auction in Thanh Oai district, Hanoi, attracted over 4,000 applications from approximately 1,600 participants, with 80% of investors forfeiting their deposits on plots of land with winning bids ranging from 80 to 100.5 million VND per square meter. Photo: M.G |
The Department of Natural Resources and Environment is tasked with expediting the process of updating and adjusting land prices, presenting them to the Hanoi People’s Committee for approval, in accordance with regulations.
Additionally, the department must promptly coordinate and guide the districts in overcoming challenges and obstacles in land price determination.
The Hanoi People’s Committee also advises the units organizing land auctions to consider adjusting the increment and form of the auction (mandatory multi-round bidding) to ensure competitiveness and alignment with market prices.
This directive comes amidst recent land auctions in Hanoi’s outlying districts, such as Hoai Duc and Thanh Oai, which have stirred the market. These auctions attracted hundreds of participants, with winning bids surpassing 100 million VND per square meter, reaching up to 133 million VND per square meter—a staggering 18 times the starting price. Many investors forfeited their deposits after winning the bids.
In a recent report to the Government Office, the Ministry of Construction also pointed out limitations and negative aspects, including the presence of “auction brokers” in some places, colluding to affect the interests of participants.
The Ministry noted the occurrence of abnormally high bids, followed by the forfeiture of deposits, creating artificial price levels to manipulate the market. It also highlighted the common practice of buying and selling multiple land lots for illegal profits, sometimes even in an organized manner.
The management agency assessed that auction results with winning bids far exceeding the starting price would negatively impact land and housing prices, as well as the housing and real estate market in terms of supply and demand.
Hong Khanh
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