Real estate legislation gets facelift for 2025
Real estate legislation gets facelift for 2025
The new Law on Real Estate Business includes regulations that could positively impact both home-buyers and investors.
According to lawyer Le Van Hoi, director of My Way Law Firm, the new law to take effect from 2025 will resolve a number of previously outstanding problems in the real estate market.
“For example, current law does not specifically regulate deposits when buying, selling, or leasing real estate to be formed in the future. However, from 2025 real estate project investors will only be allowed to collect a deposit of no more than 5 per cent of the selling price, lease-purchase price of houses and construction works built in the future,” Hoi said.
The deposit agreement must clearly state the selling price, lease-purchase price of the house, the construction project, and the construction floor area of the project, added Hoi.
This regulation is intended to partly prevent investors from using other forms of security to mobilise capital before having enough conditions, such as deposits and priority loans, to purchase products formed in the future.
The regulation of putting 20 per cent of social housing into commercial housing of every project is not only mandatory, but the responsibility of each locality’s authorities, said Phan Le Thanh Long, CEO and founder of AFA Research & Education Group, an institute providing research and professional training in accounting, auditing and finance.
“Although we will need to wait for the laws to take effect, as well as the decrees and circulars guiding the implementation, the passage of these two laws is a push for the market towards sustainable and healthy development, instead of heating up the market with speculative activities,” Long said. “The main goal of this law, as well as the upcoming Housing Law, is that all individuals have homes and land resources that are exploited properly.”
Signs of recovery in the real estate market have begun to appear with more frequency since the third quarter of 2023. Supply improved and liquidity started to increase, and investors are aggressively launching their products to the market.
The government has made several moves this year to solve difficulties in the real estate market, and support from the sharp decline in bank interest rates combined with optimistic expectations of investors have caused the market to improve.
However, Vo Hong Thang, director of Consulting and Project Development at DKRA Group, said that the market has had a certain recovery in supply and consumption in recent times, but there has not been significant recovery overall yet.
“The law changes are a necessary condition, but more conditions must be created to help the market have a stronger recovery in the coming time,” Thang said. “Some solutions include simplifying procedures so that home buyers can easily access bank capital.”
Secondly, Thang said, business sentiment is less optimistic about market recovery into next year, so it is necessary to continue promoting stimulus support packages to help the market prosper.
“Thirdly, solutions to remove legal problems that have been issued by the government must be applied thoroughly and effectively, creating confidence and resilience for the market’s recovery,” he added.
