Last week, the draft was revised and supplemented. In particular, the breakthrough regulations bringing the most hope for the market such as: “Foreign individuals allowed to enter Vietnam can own house in Vietnam” are no longer in the draft.
“Outsiders want to enter”
Mark Thomas is an executive director at a multinational company with a business in Vietnam. Every year, Mark Thomas comes to Vietnam about three or four times and each time, he often stays from a few days to a few weeks. Because of the frequent travel needs, Mark Thomas wants to buy a house in Ho Chi Minh City. However, the current regulations do not allow the purchase and sale of real estate by foreigners like Mark Thomas.
Mark Thomas is just one of thousands of foreigners willing to “pour” money into Vietnamese real estate. According to international real estate marketing consulting firm such as Vietnam Colliers, CBRE … even the most difficult times of the market when “insiders want to come out”, the consulting units continue to receive demand of “outsiders want to enter” of foreigners.
On the other hand, Vietnamese real estate market is also looking forward to “new wind” from potential demand and is ready to “spend much” in the high-end segment of foreign individuals and organizations.
From a macro management perspective, cash flow from foreigners is a valuable financial resource, without using the state’s bailout package and distorting the market.
Yet opening, but tightening
However, in the past week, the draft has been revised and supplemented. In particular, the breakthrough regulations bringing the most hope for the market such as: “Foreign individuals allowed to enter Vietnam can own house in Vietnam” are no longer in the draft.
Immediately, Ho Chi Minh City Real Estate Association (HoREA) voiced objections. Mr. Le Hoang Chau, President of HoREA said that “tightening” the conditions for foreigners to buy houses has limited, or even negated the policy of expanding the conditions for foreign individuals to be bought and owned house real estate in Vietnam because the number of foreigners “studying, working, and living in Vietnam” accounts for only a small percentage of thousands of foreigners who want to own houses in Vietnam. Moreover, this regulation does not “improve” more than the regulations detailing that foreign individuals must have an entry visa to Vietnam for 6 months or 12 months ago.
In the same view, Mr. Vu Cuong Quyet, General Director of Northern Green Land (DXG) analyzed, easing conditions of buying houses for foreigners is greatly benefited, because foreigners mainly focus on high-end segment, sometimes up to USD 5,000 – 8,000 /m2.
In fact, the draft Law on Housing (revised) was also close to the times, only the key point about the condition to buy a house. If “opening” as the original instead of “tightening”, the entire housing ownership regime of foreign organizations and individuals in the draft law will be really open and in accordance with international practice. Also, this is the inherent demand of the economy, especially from the real estate market.