BUY HOUSES IN VIETNAM: CONDITIONS AND PROCEDURES FOREIGNERS NEED TO KNOW - OTIS LAWYERS

Currently, the number of foreigners learning about detailed conditions and procedures to buy houses in Vietnam is constantly increasing. Considering the needs of foreigners about owning houses in Vietnam, helping foreigners buy houses in Vietnam conveniently and quickly, and saving the most costs incurred in the process of carrying out the procedures, OTIS LAWYERS would like to share detailed instructions on conditions and procedures for foreigners to buy houses in Vietnam are as follows.

Foreigners are entitled to buy houses in Vietnam

According to the provisions of Clause 1, Article 159 of the Law on Housing 2014, foreign organizations and individuals are allowed to own houses in Vietnam, including:

- Foreign entities who invest in project-based housing construction in Vietnam as prescribed in this Law and corresponding regulations of law;

- Foreign-invested enterprises, branches, representative offices of foreign enterprises, foreign-invested funds and branches of foreign banks operating in Vietnam (hereinafter referred to as foreign organization);

- Foreign individuals who are allowed to enter Vietnam.

Forms of house ownership by foreigners in Vietnam

Foreigners are allowed to own houses in Vietnam in the following two groups:

• Investment in construction of projects housing in Vietnam;
• Purchase, lease, gift or inheritance of commercial real estate that is apartments or separate houses in housing construction investment projects, except for areas with defense and security functions as prescribed by government.

Note:

+ The form of rent-purchase of a house is that the lessee pays the landlord 20% of the house value in advance, unless the tenant has prepayment conditions, not more than 50%;

+ The remaining amount to be paid is included in the monthly rent payable to the landlord for a certain period of time; After the lease-purchase term expires and the remaining amount is paid in full, the lessee has the right to own the house.

Thus, foreigners, including foreign organizations and individuals, are only allowed to buy houses that are apartments or villas, adjacent houses in housing construction investment projects, with infrastructure and houses built. Foreigners are not allowed to buy land or houses in residential areas.

Conditions for foreigners to buy houses in Vietnam

For individuals and organizations investing in housing construction under projects in Vietnam, when owning a house in Vietnam, they must satisfy the following conditions:

• An investment certificate
• There are houses built in the project according to the provisions of the law on housing.

For foreign organizations being foreign-invested enterprises, branches, representative offices of foreign enterprises, foreign investment funds and branches of foreign banks operating in Vietnam when buying a house in Vietnam, they must meet the following conditions:

• Having an Investment Certificate or a document related to being allowed to operate in Vietnam (hereinafter referred to as the Investment Certificate) issued by a competent Vietnamese state agency.

For foreigners buying houses in Vietnam:

• Being allowed to enter Vietnam and not being entitled to diplomatic and consular privileges and immunities as prescribed by law.

Foreigners are only allowed to own houses when:

• Only buy, rent-purchase, receive as gifts, inherit and own no more than 30% of the number of apartments in an apartment building; if it is a separate house, including villas and adjacent houses, in an area with a population equivalent to a ward-level administrative unit, only buy, rent, receive as a gift, inherit and own no more than two hundred and fifty houses.

Term of house ownership by foreigners in Vietnam

• Foreign individuals are allowed to own houses as agreed upon in contracts of purchase, sale, lease, gift or inheritance, but for a maximum of 50 years from the date of issuance of the Certificate and may be extended according to the Government's regulations if required; the duration of house ownership must be clearly stated in the Certificate;
• In case a foreign individual marries a Vietnamese citizen or marries a Vietnamese residing abroad, he/she is entitled to own a stable and long-term house and has the same rights of a home owner as a citizen. Vietnam;
• For foreign organizations, they are allowed to own houses as agreed upon in contracts of purchase, sale, lease, gift or inheritance of houses, but not exceeding the time limit stated in the Investment Certificate. grants to the organization, including for an extended period; the house ownership period is counted from the date the organization is granted the Certificate and is clearly stated in the Certificate.

Order and procedures when foreigners buy houses in Vietnam

Step 1: Sign the contract

Step 2: Notarize and authenticate the contract.

Step 3: Apply for a certificate

The parties submit a dossier to request the competent state agency to issue a certificate for this house; For the case of purchase or lease of an apartment, the investor is responsible for carrying out the procedures for the competent state agency to issue the Certificate to the buyer or the lessee, unless purchaser, the lessee voluntarily carries out the procedures to apply for a certificate.

Procedures for transfer of commercial housing purchase and sale contracts for foreigners

According to the provisions of Clause 2, Article 123 of the Law on Housing 2014 and Article 32 of Circular 19/2016/TT-BXD, if the buyer of a commercial house has not yet submitted the application to the state agency, has the authority to issue the Certificate for that house and, if needs, may transfer the house purchase and sale contract; the contract transferee is responsible for fulfilling all obligations under the house purchase and sale contract signed with the investor.

The order and procedures for transferring commercial housing purchase and sale contracts are specified in Article 33 of Circular 19/2016/TT-BXD as follows:

Step 1: Draft a transfer contract 

- Quantity: The signed contract transfer document is made into 06 copies (03 copies are handed over to the investor for safekeeping, 01 copy is submitted to the tax authority, 01 copy is kept by the transferee and 01 copy is held by the transferor)

- In case the contract transfer document must be notarized or authenticated, the notary public must keep one copy.

Step 2: Notarize or authenticate the contract

- In case the transferor of the house purchase and sale contract is not a company or cooperative with the function of real estate business in accordance with the law on real estate, the transfer contract must be notarized or authenticated

- The transferor of the apartment sale and purchase contract is a company or cooperative with the function of real estate business, the notarization of the lease contract is optional but agreed upon by the parties themselves.

- Notarization location: Notarization at the Office / Notary in the province, city directly under the Central Government where the house is located.

Step 3: Declare taxes, fees and charges

Step 4: Ask the investor to confirm this in the transfer contract 

Step 5: Submit application for certificate

(If the commercial housing purchase and sale contract has been agreed with the investor, voluntarily carry out the procedures for granting the certificate to the competent state agency).

The above is the full content of detailed regulations on conditions, order and procedures applied in case foreigners buy or transfer houses in Vietnam.

For any questions or comments, please contact:

OTIS AND PARTNERS LAW FIRM

Office address: K28 - Group K, Lane 68 Trung Kinh, Yen Hoa Ward, Cau Giay District, Hanoi

Email: [email protected]