Mr. Nguyen Tien Thoa – Chairman of the Vietnam Valuation Association, former Director General of the Price Management Department, Ministry of Finance. Photo: MarketTimes
Regarding this issue, MarketTimes is honored to present the full article by Mr. Nguyen Tien Thoa – Chairman of the Vietnam Valuation Association, former Director General of the Price Management Department, Ministry of Finance.
Since our country implemented the economic reform, the pricing mechanism for goods and services in general, and the real estate pricing mechanism in particular, has gradually shifted towards a market-based approach. This shift, influenced by the “invisible hand” and regulated by the state, has demonstrated positive effects on the economy.
However, alongside its benefits, this mechanism inherently contains elements of spontaneity that can negatively impact the economy. These are the “flaws” of the market mechanism, leading to market “failures” in efficiency, fairness, macroeconomic stability, public goods, information, and imperfect markets.
The state, in its role as the coordinator of a mixed economic model, must not only facilitate and enhance the positive effects of the “invisible hand” but also address these flaws to ensure sustainable economic growth and efficiency through appropriate tools aligned with objective economic laws.
Vietnam’s real estate market operates within this context and has shown signs of “exceeding state control over prices,” as questioned by the Prime Minister and General Secretary: “Why are real estate prices so high?” (This can be interpreted as: Why are real estate prices unreasonably high compared to income, living standards, and the overall socio-economic landscape?).
Some argue that the primary cause is the implementation of market-based land pricing under the 2024 Land Law. I share this view, as land pricing has been market-based since the 1993 Land Law, but local governments previously set prices far below market rates and adjusted slowly. In 2024, when prices were aligned with the market, the sudden increase was inevitable.
While high land prices contribute to rising real estate prices, they are not the main cause. Market prices are determined by supply and demand dynamics, not administrative adjustments. To stabilize prices, we must address the root causes rather than impose administrative fixes.
Real estate prices reflect broader economic relationships, such as supply and demand, production and consumption, and money supply. Effective regulation of these factors will lead to a balanced and stable pricing system, benefiting the economy.
Currently, real estate prices reflect market distortions in supply, demand, competition, and speculation. The state’s regulatory measures have been inadequate, leading to unreasonable price increases. To address this, I propose four core solutions:
First: The expansionary credit policy in real estate has fueled demand, creating a cycle of “money drives prices up, prices drive money up.” This makes price stabilization challenging. To break this cycle, credit policies must be tailored to differentiate between speculative and genuine demand, tightening credit for speculation and loosening it for affordable housing and genuine buyers.
Second: Speculation, land hoarding, and market manipulation distort supply and demand, leading to artificial shortages and price volatility. To combat this, administrative and economic measures are needed, including higher taxes on multiple property owners and stricter penalties for land hoarding.
Third: Complex administrative procedures for real estate projects increase costs and delay supply. Streamlining these procedures and reducing compliance costs will help increase market supply.
Fourth: Price manipulation through auctions and bidding wars creates artificial price bubbles. Strengthening auction regulations, increasing deposit requirements, and imposing stricter penalties for manipulative practices will help stabilize prices.
These solutions, focusing on fiscal and monetary policies, must be implemented cohesively alongside medium and long-term measures to achieve market stability. Additionally, land pricing regulations under the Land Law should be revised to ensure transparency and consistency in valuation practices.
References:
[1] Dau Tu Online, October 2, 2025
[2] Vietnam Real Estate Association Report, May 24, 2025
[3] Dau Thau Newspaper, October 10, 2024
[4] Dau Tu Online, December 20, 2024
Transparent, Scientific, and Synchronized Mechanism Needed to Align Land Prices with True Market Value
Unlocking the complexities surrounding land pricing is a pivotal step toward fostering a sustainable real estate market, according to industry experts. By addressing these critical bottlenecks, we pave the way for robust economic and social development, ensuring long-term stability and growth.
Why Nearly 100,000 Apartments in Ho Chi Minh City Remain Without Land Ownership Certificates
During the period from 2007 to 2010, data collection for land valuation purposes was nearly impossible, leaving 84 land allocation and land-use conversion files for real estate projects unpriced to this day. As a result, nearly 100,000 apartments remain without land-use right certificates (commonly known as “sổ hồng”).
Lotte Advances $870 Million Thu Thiem Project as Ho Chi Minh City Resolves Key Obstacles
At the meeting held on the afternoon of October 3, 2025, Ho Chi Minh City’s Chairman of the People’s Committee, Nguyễn Văn Được, affirmed that city leaders will collaborate closely with investors. They will also incorporate Lotte’s recommendations into proposals submitted to the Government to address existing challenges.
Unlocking Decades-Old Land Disputes: Resolution for Pending Cases Since 2003 on the Horizon
At today’s press conference on socioeconomic issues held on October 2nd, representatives from the Ho Chi Minh City Department of Agriculture and Environment announced accelerated efforts to finalize land pricing following the implementation of the 2024 Land Law and its accompanying decrees. Once resolved, these measures are expected to unlock numerous large-scale projects, paving the way for the approval of tens of thousands of residential units.
Land Prices and the Strategic Vision of the General Secretary
“Land prices, susceptible to market manipulation and inflation, have become a pressing concern,” stated General Secretary Tô Lâm during a recent meeting with voters in Hanoi, sparking widespread discussion and debate.
