Regarding the policy on home ownership and land use, the duration of land use for production and business in special economic administrative units shall not exceed 70 years and maximum 99 years for investment projects supporting creative start-up accelerators, health, education research and development centers at special economic administrative units such as Van Don (Quang Ninh), Northern Van Phong (Khanh Hoa) and Phu Quoc (Khanh Hoa).
Foreign organizations and individuals who are entitled to own houses in Vietnam under the housing law have the right to receive, transfer, purchase, lease, donate, inherit the commercial houses including apartment and detached houses in investment projects on housing construction and real estate investment projects for tourism in special economic administrative units except for national security areas as regulated by the Government.
The provision will facilitate the development of real estate market, resort tourism in administrative units as well as increase the national budget. The Government’s move will also attract foreign investors’ attention to the real estate market in Viet Nam. Thereby, more jobs will be created, contributing to the socio-economic development.
Many hidden negative impacts
According to the drafting committee of the Special Economic Administrative Unit Law, besides the positive effects, the regulation of extending the foreigner’s house ownership also poses many negative impacts.
Firstly, the regulation can increase real estate prices in special economic administrative units, driving the cost of compensation and site clearance for the implementation of investment projects in these areas, thus reducing the opportunity of local people and enterprises.
Secondly, the ongoing number of foreigners buying houses and real estate is also accompanied by an increase in the operation costs of the competent authorities in the areas.
In addition, the term of land use up to 99 years causes difficulties in compensation and site clearance in case the land is recovered for other purposes. At the same time, the regulation will raise the scarcity of land funds to serve socio-economic development in the long term.
Finally, the drafting committee also said that the extension of foreigners’ ownership of houses may trigger negative reaction of the local people and enterprises if foreigners own too many houses and properties in these special economic administrative units.
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