VietNamNet Bridge – The Ministry of Construction (MOC) has proposed the government to allow all the foreigners, who have the visas to stay in Vietnam for 3 months or more, to buy houses in Vietnam. No limitation in the number of houses on the subjects would be set.
The ministry believes that the current policies on allowing foreigners buy and possess houses in Vietnam have shown shortcomings which need to be settled.
The currently applied Resolution No. 19 stipulates that five groups of foreigners are allowed to own properties in Vietnam. Meanwhile, MOC believes that the right to buy houses should be extended to other subjects as well.
It has suggested allowing foreign investment funds, foreign banks, branches and representative offices of foreign invested enterprises operational in Vietnam to buy houses. Only diplomatic and non-government organizations would not be able to do that.
As for foreign individuals, the ministry’s viewpoint is that all the foreigners with the visas to stay in Vietnam for 3 months or more should be allowed to possess houses in Vietnam, except the ones working for diplomatic and non-government organizations.
Regarding the number of houses foreigners can buy, MIC has put forward two solutions.
In the first one, foreign individuals would be allowed to buy limitless houses in Vietnam. Meanwhile, the number of houses foreign institutions can buy would depend on the number of workers of the organizations.
In the second one, foreign individuals would have no more than 2 apartments, separated apartments, or villas.
Under the MIC’s proposal, foreigners would be allowed to sell or give their houses to others after 12 months since the day they get the property ownership certificates. In case they sell houses before due, they would have to pay the income tax which is double the tax rate they have to pay under the current regulations.
The noteworthy point in the MIC’s proposal is that foreigners would not be able to borrow money from the banks operational in Vietnam to buy houses in Vietnam.
Anticipating the possible difficulties in the management, MIC thinks that foreign individuals and organizations should be allowed to buy no more than 30 percent of the total apartments within the same apartment buildings. The regulation aims to prevent the taking shape of the “foreign areas” in Vietnam.
The suggestion by MIC to extend the subjects that have the right to buy houses in Vietnam clearly shows its efforts to clear the high inventories of apartments and houses.
MIC, when explaining its plan, also said that the plan, if approved, would not be able to help Vietnamese real estate developers boost sales to revive, but also help the State collect taxes from the house leasing and trade transactions.
Meanwhile, it believes that the policy would in no way affect the market prices and the housing demand from the poor and low income earners.
A report showed that by the second quarter of 2013, houses had been sold to foreigners in 126 cases, mostly in the southern localities, such as HCM City, Ba Ria – Vung Tau, Binh Duong and Khanh Hoa in the central region.
The report also pointed out that 80 percent of the buyers were foreign individuals, while only 20 percent of them were institutions. Of the 108 individuals who bought houses in Vietnam, most of them got married with Vietnamese citizens.