3 real estate related laws come into effect: How will the market change?

According to the assessment of representatives of the Ministry of Natural Resources and Environment and the Ministry of Construction, with the three laws (Land Law, Real Estate Business Law, Housing Law) just coming into effect, from now on, the legal corridor directly affecting the fields of land, housing and the real estate market will be much more open.

Fraudulent and deceptive acts in real estate business will also be prevented, helping the real estate market to be transparent and develop sustainably.

Removing obstacles, market transparency

Deputy Director of the Department of Housing and Real Estate Market Management (Ministry of Construction) Vuong Duy Dung said that the Land Law, Real Estate Business Law, and Housing Law taking effect from August 1, 2024 (5 months earlier) will remove many policy obstacles, especially social housing policies.

“Previously, the Housing Law and the Real Estate Business Law had groups of problems related to the approval of investment policies for commercial housing, related to the development of social housing, conditions for real estate business recovery, real estate market conditions of participating entities (brokers, real estate trading floors)... However, when the above 3 laws came into effect, these problems were all resolved,” said Mr. Dung.

Citing the amendments to the Housing Law, Mr. Dung said that new regulations have been added such as: Procedures for implementing social housing will be shortened and streamlined; regulations on enjoying social housing policies will be simplified; regulations on incentives for social housing investors will be made easier and other regulations on determining and calculating the purchase and sale prices of social housing.

According to Deputy Director Vuong Duy Dung, the above changes and additions will help increase the supply of real estate and the structure of social housing. The important issue is that the management agency needs to clarify information for real estate projects when they are put into business, for available housing constructions or land use rights of projects. In addition, the projects also need to be publicly announced on the information system on the website of the Ministry of Construction and enterprises.

“At that time, the subjects can refer to it, the operations of the trading floors will also be transparent; thereby increasing the supply of the real estate market, including transaction prices and real estate segments in the coming time,” said Mr. Dung.

On the side of the Ministry of Natural Resources and Environment, Deputy Director of the Land Department Le Van Binh also affirmed that pushing the 3 laws 5 months earlier than expected (compared to the original date, January 1, 2025) is very beneficial for the real estate market. Accordingly, the land access project will be more transparent and many land access mechanisms for real estate investors will be very transparent.

“When the mechanism is transparent, it will create convenience for investors, and people will not be entangled in legal procedures. Previously, we had specific prices, but in many places, the prices were still lower than the market. Although the new regulations still use specific prices, they gradually approach the market price. In addition, land types are regulated more specifically and in more detail,” Mr. Binh emphasized.

Director of the Department of Planning and Land Resources Development Dao Trung Chinh said that the 2024 Land Law is a huge “boost” for the real estate market. The law has anticipated obstacles and transitional conditions of projects, helping the real estate market develop more transparently.

In particular, the Land Law has emphasized the need for local decentralization, linked to local conditions, and at the same time requires localities to develop models and regulations suitable to the locality.

Adjust supply and demand, selling price at reasonable level

Regarding financial issues to support real estate development, Vice Chairman and General Secretary of the Vietnam Banking Association Nguyen Quoc Hung said that with the three laws on land, housing and real estate business taking effect from August 1, 2024, the real estate market will certainly have many changes.

According to Mr. Hung, the banking sector is currently focusing its capital resources on providing real estate loans, including social housing, so there is no shortage of money. Even if real estate projects meet the completion requirements according to legal regulations, there will be no shortage of capital.

"At that time, not just a few banks, but dozens of banks will support and have a policy to reduce interest rates. The State Bank has also directed this issue very strongly," Mr. Hung shared.

Providing more information about the current real estate supply situation, Mr. Nguyen Van Dinh - Vice President of Vietnam Real Estate Association, President of Vietnam Real Estate Brokers Association, said that in recent years, the market has not had any new projects approved or granted investment licenses. The projects are mainly old projects and projects that have been bought and sold. The supply is both lacking and of poor quality; the supply for the people and the poor is very little; the product structure is not suitable.

“Hopefully, when the Land Law, Real Estate Business Law, and Housing Law come into effect, many projects will be resolved, and more supply will be pushed into the market. Many segments of apartments, mini apartments, condotels, resort apartments, and quality housing will appear abundantly, thereby contributing to reducing supply-demand pressure and prices will be adjusted,” Mr. Dinh shared.

Mr. Dinh also hopes that the upcoming government management will help the market have many new projects, including several thousand apartment products for sale at suitable prices to resolve the supply-demand problem.

“Regarding real estate prices, I think that areas that previously had bubbles and virtual fevers will certainly be adjusted to their real values. At that time, supply and demand will be adjusted and at reasonable prices,” said Mr. Dinh.

However, the Vice President of the Vietnam Real Estate Association also noted that the general trend of the real estate market in the coming time will not be a price decrease, no bubble will appear, but real estate prices will be determined by market demand and product quality.