The price of the apartment is affected if the ownership has a term

is expected to renovate and rebuild old apartment buildings, embellish urban reconstruction, ensure safety. Besides, it is also necessary to take into account the needs and interests of the people.

Many people have long considered motorbikes and cars not only vehicles Or a house is not only a place to live but also an asset. Many people have to spend a lot of time working hard and frugally to get it. Specifically, many people were allocated apartments by the state from the 70s-80s of the last century, which are now very old.. but still are assets worth billions of dong.

However, in the recent draft Law on Housing (amended) of the Ministry of Construction, two options have been proposed. Option 1, supplementing the regulation that the term of ownership of an apartment building is determined by the term of use of the work in accordance with the provisions of the law on construction, it may be 50 years, 70 years or may be longer depending on the quality of the project. Option 2, the term of ownership of the apartment building.. is determined according to the land use term for the construction of the apartment building in accordance with the land law.

Thus, when the life cycle of the apartment building is no longer (due to being demolished), the ownership rights of the owners to this apartment building will also end because the assets recorded as ownership will no longer exist. .

The price of the apartment is affected if the ownership has a term

Currently, land use fees and other land-related costs account for about 10% of the apartment’s selling price. Therefore, if the project has a useful life, the investor only pays part of the land cost according to the prescribed number of years such as 50 or 70 years.

Mr. Le Hoang Chau, Chairman of Ho Chi Minh City Real Estate Association. Ho Chi Minh said: “The basic reason is because the cost of creating a land fund, including land use fees payable to the state, has not been 100% included in the selling price of the apartment, but sold for a limited time. We found that if we implement the regime of ownership of an apartment with a term, the selling price of such a fixed-term apartment is definitely lower than the current equivalent price of an apartment that people can own forever.”

In addition to the factors that make up the price, the shifting sentiment will also have a significant impact on the apartment market.

According to Dr. Su Ngoc Khuong, Senior Director of Savills Vietnam Investment Department, real estate is always understood as an asset with added value in the future. If the regulation of apartment ownership is applied for a limited time, there is a risk of cash flow from apartments to townhouses or land plots. This will have a significant impact on the liquidity of the apartment market.

Dr. Su Ngoc Khuong said: Senior Director of Investment Department Savills Vietnam, shared: “I think the liquidity at this time should also be considered by the market, and the reduction, I think in the context of the fund. Land in Ho Chi Minh City and Hanoi, the needs of the people as well as the project implementation time, the reduction of real estate prices due to the condition of 50 – 70 years is very difficult for real estate developers. I am wondering about low liquidity, sometimes losing the liquidity of the apartment market.”

Mr. Phan Huy Cong, Hanoi, said: “Apartment property is a long-term asset, in the future we still want to leave it for our children and grandchildren. So, when we read this notice, we were very confused. . We have to wait for an official decision from the government, before we decide whether to continue buying or not.”

In fact, the regulation of apartment ownership term has been applied in many countries around the world. As in Singapore, ownership of apartments is regulated from 70 to 99 years. With Thailand, there are 2 forms of apartment ownership, which are long-term and have a maximum term of 30 years, which can be extended. The UK or the US also sell apartments and many other types of real estate in the form of ownership. ownership for a limited time, up to a maximum of 99 years, and an additional fee is charged for renewal of ownership.

In Japan, the construction and sale of apartment buildings developed strongly, especially during the period of economic miracle of this country from 1960-1970, since then, the demand for apartments has always been higher than that of the country. with private property.

According to the Ministry of Construction, this is only the main proposal, however, these proposals are causing many different opinions. The term of apartment use has been applied by many countries. But in Vietnam, how to balance the legitimate rights of people to have a place to live and also ensure the safety of high-rise apartments is a problem. Many people fear that the regulation of the apartment ownership term determined according to the building’s useful life as prescribed by the law on construction will make many people not want to live in an apartment building but turn to buying land. long-term protection of your assets. Balancing these interests is a challenge for the Drafting Committees and legislators.

The program Today’s Issue broadcast on June 7 with the guest Mr. Nguyen Chi Thanh, Vice Chairman of the Vietnam Real Estate Brokers Association, will analyze this issue in detail. We invite you and your friends to watch!

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