LEGAL RIGHTS TO PURCHASE, OWN, AND LEGALLY USE REAL ESTATE OF VIETNAMESE PEOPLE RESIDING ABROAD
Đặng Phước Thông
MSc, Ho Chi Minh City University of Law
Nguyễn Đăng Long
MSc, Lecturer, Ho Chi Minh City Open University
Phan Đặng Hiếu Thuận
MSc, Lecturer, Ho Chi Minh City Open University
ABSTRACT
This paper seeks to analyze the provisions in the 2024 Law on Land and the 2023 Law on Housing concerning the types of real estate and the general and specific conditions that Vietnamese people residing abroad must meet to legally purchase, own, and use various types of real estate in Vietnam.
Keywords: Vietnamese people residing abroad, ownership rights, real estate
I. INTRODUCTION
Currently, the 2024 Law on Land, the 2023 Law on Housing, and the 2023 Law on Real Estate Business have amended regulations such that Vietnamese people residing abroad who hold Vietnamese nationality are considered Vietnamese citizens and therefore have “full” rights related to land (not just residential land), similar to domestic Vietnamese citizens (individuals residing domestically), while maintaining current policies for Vietnamese people residing abroad (National Assembly Standing Committee, 2024).
In this section, the authors only examine the rights to legally purchase, own, and use real estate in Vietnam for Vietnamese people residing abroad who do not hold Vietnamese citizenship, to distinguish from “domestic individuals and Vietnamese people residing abroad who are Vietnamese citizens”. Specifically, the authors explore the provisions in the 2024 Law on Land and the 2023 Law on Housing concerning the types of real estate and the general and specific conditions that Vietnamese people residing abroad must meet to legally purchase, own, and use real estate in Vietnam.
II. MEETING GENERAL PERSONAL CONDITIONS FOR THE RIGHT TO PURCHASE AND OWN REAL ESTATE IN VIETNAM
Article 2 of Resolution No. 19/2008/QH12 dated June 3rd, 2008, of the National Assembly, stipulates the pilot program allowing foreign organizations and individuals to purchase and own real estate in Vietnam. It specifies four categories of “foreign individuals permitted to purchase and own housing in Vietnam” based on the purposes for which these individuals benefit from the real estate purchase and ownership policies in Vietnam.
However, this categorization results in inequality regarding access to land and other real estate, as foreign individuals are classified under the 2008 Vietnamese Nationality Law based on personal criteria, distinguishing between Vietnamese people residing abroad with Vietnamese nationality, those allowed to enter Vietnam, and overseas Vietnamese (commonly referred to as “Vietnamese expatriates”), versus foreign nationals. Consequently, restructuring the subjects eligible to purchase and own housing in Vietnam is a necessary legislative trend, meeting the aspirations of overseas Vietnamese returning to contribute to the homeland’s economy.
In the 2024 Law on Land, the term “Vietnamese people residing abroad” has been replaced with “Vietnamese origin people residing abroad,” a term used in the Nationality Law (Report No. 724/BC-UBTVQH15, 2024). Accordingly, concerning the right to purchase and own real estate, point c, clause 6, Article 4 of the 2024 Law on Land specifies personal conditions such as:
“Land users assigned land by the State, leased land, or recognized land use rights (LUR); using land stably and meeting the conditions for the issuance of the Land Use Rights Certificate (LUR Certificate), ownership of assets attached to land…, including:…; 6. Vietnamese origin people residing abroad…”. Additionally, points c and h, clause 1, Article 28 of the 2024 Law on Land stipulate: “Recipients of LUR are regulated as follows:… c)…, Vietnamese origin people residing abroad allowed to enter Vietnam can receive the transfer of LUR within the area…; h) Vietnamese origin people residing abroad allowed to enter Vietnam can purchase, lease-purchase housing attached to residential LUR, receive residential LUR in housing development projects.”
In the 2023 Law on Housing, point b and c, clause 1, Article 8 stipulates that “Subjects allowed to own housing in Vietnam include: b) Vietnamese people residing abroad in accordance with the nationality law; c) …, foreign individuals as prescribed in clause 1, Article 17 of this Law.” Additionally, point b and c, clause 2, Article 8 of the 2023 Law on Housing provides that “Conditions for owning housing in Vietnam include: “…b) Vietnamese people residing abroad who are allowed to enter Vietnam can own housing associated with residential land use rights (LUR) in accordance with land law; c) Foreign organizations and individuals can own housing through the forms specified in clause 2, Article 17 of this Law.”
Therefore, according to these provisions, there are two personal conditions that foreign individuals without Vietnamese nationality must meet to purchase and own real estate in Vietnam under the new law: (i) the necessary condition is that the subject must have previously held Vietnamese nationality and, when born, their nationality was determined by the principle of bloodline, and their children or grandchildren are residing and living long-term abroad
(clause 4, Article 3 of the 2008 Vietnamese Nationality Law; clause 6, Article 4 of the 2024 Law on Land; point b, clause 1, Article 8 of the 2023 Law on Housing). (ii) The sufficient condition is that the subject must be allowed to enter Vietnam (points c and h, clause 1, Article 28 of the 2024 Law on Land; point b, clause 2, Article 8 and point c, clause 1, Article 17 of the 2023 Law on Housing).
III. MEETING SPECIFIC CONDITIONS FOR THE CONTENT AND FORM OF RECEIVING OWNERSHIP AND USAGE RIGHTS OF VARIOUS TYPES OF REAL ESTATE
- Vietnamese Origin People Residing Abroad Eligible for Free Transfer of Land Use Rights
The most important criterion to be met is the area permitted by law for Vietnamese origin people residing abroad to receive the transfer of land use rights (LUR). Specifically, point c, clause 1, Article 28 of the 2024 Law on Land stipulates the areas permitted by the new land law for the transfer of LURs, including three areas: “industrial zones, industrial clusters, and high-tech zones”. Correspondingly, the rights and obligations of Vietnamese origin people residing abroad using land in these zones are specified in Article 43 of the 2024 Law on Land as follows:
“1. Vietnamese origin people residing abroad receiving the transfer of LUR in industrial zones, industrial clusters, and high-tech zones have the rights and obligations specified in clause 1 and clause 3, Article 33 of this Law.
- Vietnamese origin people residing abroad who lease land or sublease land in industrial zones, industrial clusters, and high-tech zones have the following rights and obligations:
- a) If paying land lease or sublease for the entire lease term at once, they have the rights and obligations specified in clause 1 and clause 3, Article 33 of this Law.
- b) If paying land lease or sublease annually, they have the rights and obligations specified in clause 1, Article 34 of this Law.”
Thus, in reality, the transfer of land use rights (LUR) for Vietnamese origin people residing abroad is not entirely free for any type of land in Vietnam but is limited to the aforementioned three areas. Additionally, the transfer of LUR must stem from the State granting LUR through the form of “State allocation of land with land use levy, land lease with one-time rental payment for the entire lease term,” rather than freely transferring long-term LUR from domestic individuals. This represents a limitation on land access.
Therefore, for Vietnamese origin people residing abroad to be eligible for the transfer of LUR in the above-mentioned areas, the Government must issue specific procedures and processes, aligning with the responsibilities stipulated in clause 3, Article 28 of the 2024 Law on Land: “For areas with restricted land access, the transfer of LUR as stipulated in clauses 1 and 2 of this Article shall be carried out according to the procedures specified by the Government.”
- Vietnamese Origin People Residing Abroad Eligible for the Transfer of Real Estate for Residential Purposes
2.1. Criteria for the Type of Real Estate Eligible for Transfer Must Be Housing Attached to Residential Land Use Rights or Land Intended for Residential Purposes
Specifically, point h, clause 1, Article 28 of the 2024 Law on Land stipulates: “1. Recipients of Land Use Rights (LUR) are regulated as follows: … h) Vietnamese origin people residing abroad who are allowed to enter Vietnam can purchase, lease-purchase housing attached to residential LUR, or receive residential LUR in housing development projects.”
Additionally, clause 1, Article 44 of the 2024 Law on Land also clearly states: “1. Vietnamese origin people residing abroad who are allowed to enter Vietnam can own housing attached to residential LUR in Vietnam; they can have residential LUR through the transfer of residential LUR in housing development projects.” These provisions indicate that Vietnamese origin people residing abroad not only have the right to purchase and lease-purchase real estate but also have the right to transfer residential LUR for residential purposes.
The provision at point h, clause 1, Article 28 of the 2024 Law on Land extends beyond merely owning “apartments in commercial housing development projects” to include the right to purchase and lease-purchase real estate for residential purposes, in both forms of owning “housing attached to residential land use rights” and the use of “residential land,” all within “housing development projects.”
This innovation encompasses the type of real estate as “apartments in commercial housing development projects” because they share the common characteristic of ownership attached to land use rights (LUR), most clearly demonstrated by the regulation that apartment ownership is attached to LUR divided proportionally. Therefore, this type of real estate is a form of “housing attached to residential LUR” (Đặng Phước Thông, 2020).
One point to note is that because these residential real estates are characterized by being attached to residential LUR, and the possession and execution of LUR are under a mandatory registration mechanism for the State to uniformly manage and ensure land security, the National Assembly Standing Committee (UBTVQH) proposed that the National Assembly amend the provision at point b, clause 2, Article 8 of the 2023 Law on Housing to refer to the Law on Land to ensure consistency, as follows: “Vietnamese people residing abroad who are allowed to enter Vietnam can own housing attached to residential LUR in accordance with the land law” (Report No. 661/BC-UBTVQH15, 2023).
In reality, many foreigners have come to Vietnam to work, marry, and even learn Vietnamese to live and reside long-term in Vietnam. They have also spent money to purchase apartments, individual houses, and residential land to live long-term in Vietnam. However, even they may not fully understand their rights and obligations when they have invested in owning such real estate. Therefore, clause 2, Article 44 of the 2024 Law on Land specifically provides for the rights and obligations concerning residential land use for Vietnamese origin people residing abroad who own housing in Vietnam after completing the purchase of residential real estate.
Thus, not any type of land or real estate structure attached to land use rights (LUR) can be accessed and purchased by Vietnamese origin people residing abroad who meet the personal conditions. Only two types of real estate can be accessed for the purpose of purchasing: land intended for residential purposes and housing attached to residential LUR. However, to demarcate the real estate that can be purchased for residential purposes by Vietnamese origin people residing abroad, the law limits the scope to “housing development project” areas. Outside these areas, they cannot freely access real estate for purchase.
2.2. Criteria for Areas within Housing Development Projects are Crucial Conditions for Eligibility to Transfer Real Estate for Residential Purposes
The “housing development” work is carried out for various types of projects such as: multi-story individual apartments; social housing; for the people’s armed forces; by project; serving resettlement. Accordingly, for “housing development projects” within the scope of housing development by project, clauses 4 and 5, Article 5 of the 2023 Law on Housing adjust.
These regulations serve as a basis for local authorities to identify areas that must develop housing by project or not by project, guiding urban development planning. Clarifying within the Law, the special urban areas, and the areas of Class I, Class II, and Class III urban areas, only allow housing development by project to prevent issues such as loosely controlled land subdivision, lack of planning, and inadequate fire prevention, electricity, and water supply that have occurred in many places recently (Report No. 661/BC-UBTVQH15, 2023).
The reason for regulating the development of apartment buildings in Class I urban areas is that, in practice, “Some localities, although Class II, Class III (even Class I such as Hai Phong, Can Tho, Quang Ninh) still have abundant land resources, low land prices, and people are not accustomed to living in apartment buildings…,” thus, focusing on the development of apartment buildings in Class II urban areas would not be suitable for the actual situation and should allow local authorities to balance and orient themselves (Summary report on the implementation of the 2014 Law on Housing and orientation for amending the Law on Housing).
Therefore, clause 4, Article 5 of the 2023 Law on Housing only recognizes “Class I urban areas, in wards, districts, and cities under special urban areas” as areas Vietnamese origin people residing abroad should consider purchasing.
Additionally, Article 16 of the 2023 Law on Housing also stipulates: “1. …, foreign individuals are allowed to own housing in housing construction investment projects as stipulated in Article 17 of this Law, except for projects in areas that need to ensure national defense and security according to Vietnamese law. 2. The Ministry of Defense and the Ministry of Public Security are responsible for notifying areas that need to ensure national defense and security so that the provincial People’s Committees can identify and publicly announce these areas.”
Comparing this with clause 1, Article 44 of the 2024 Law on Land, which states that Vietnamese origin people residing abroad “are allowed to own housing attached to residential land use rights (LUR) in Vietnam; have residential LUR through the transfer of residential LUR in housing development projects,” with clause 1, Article 16 of the 2023 Law on Housing, which stipulates that “foreign individuals are allowed to own housing in housing construction investment projects,” reveals the following inconsistencies:
(i) Article 44 of the 2024 Law on Land provides for the transfer of “residential LUR,” while Article 16 of the 2023 Law on Housing does not address this issue and only recognizes “housing ownership.” Owning housing in Vietnam can mean owning housing attached to LUR and owning housing not attached to LUR, and housing is a type of structure on land with a solid construction and built according to legal construction standards, making it very different from residential land.
Therefore, the inconsistency between these two provisions in the same Law will lead to inconsistent understanding and application, particularly regarding the issue of transferring “residential LUR” for Vietnamese origin people residing abroad when they meet the personal conditions and purchasing criteria within the legally designated area.
However, according to the explanation of the National Assembly Standing Committee (UBTVQH) on this issue, the 2023 Law on Housing should focus solely on regulations concerning housing, including ownership of housing by organizations and individuals. Issues related to residential land and land use rights (LUR) will be governed by the 2024 Law on Land.
Therefore, Articles 16, 17, and 18 of the 2023 Law on Housing are structured to focus on housing ownership regulations. Regulations concerning LUR in the aforementioned cases will be governed by the Law on Land. This ensures consistency with clause 1, Article 13 of the 2023 Law on Real Estate Business, which states: “1. The purchase and sale of housing, construction works, or parts of the construction work must be associated with land use rights, except where the Law on Land or the Law on Housing provides otherwise.”
Furthermore, according to the UBTVQH, Articles 8, 10, 11, 20, 21, and 161 of the 2023 Law on Housing reference the implementation of regulations in the Law on Land regarding housing ownership associated with LUR for Vietnamese people residing abroad (including those still holding Vietnamese nationality and those of Vietnamese origin without Vietnamese nationality) (Summary Report of the UBTVQH, 2023). Additionally, point b, clause 2, Article 8 of the 2023 Law on Housing stipulates: “Vietnamese people residing abroad who are allowed to enter Vietnam can own housing attached to residential LUR in accordance with the land law,” to ensure consistency (Report No. 661, 2023).
(ii) Although Article 16 of the 2023 Law on Housing is directed toward housing ownership, and issues regarding land use rights (LUR) are cross-referenced to the 2024 Law on Land as previously mentioned, the relationship concerning housing ownership outlined in Article 16 has not clearly distinguished between types of housing attached to or not attached to LUR in the form of apartments.
According to clause 2, Article 17 of the 2023 Law on Housing: “2. …, foreign individuals stipulated in clause 1 of this Article are allowed to own housing in Vietnam, including apartments and individual houses…”. The essence of the subject with ownership rights to housing in the form of apartments is a form of mixed apartment ownership, and this right carries the characteristic of apartment ownership attached to LUR divided proportionally (Đặng Phước Thông, .id, pp. 37, 38, 39). Therefore, adjusting this type of real estate in the 2023 Law on Housing seems to conflict with the explanation provided by the UBTVQH.
(iii) Article 44 of the 2024 Law on Land specifies that the areas eligible for purchase are “within housing development projects,” while Article 16 of the 2023 Law on Housing notes that the areas eligible for purchase are “within housing construction investment projects” and areas not eligible for purchase are those “projects in areas that need to ensure national defense and security.”
The issue arises as to whether “housing development projects” and “housing construction investment projects” are understood similarly. Conceptually, clause 15, Article 2 of the 2023 Law on Housing defines “Housing development as the investment in new construction, reconstruction, or renovation of housing to increase housing area,” while clause 12 of the 2023 Law on Housing defines “Housing construction investment projects as a set of proposals related to the use of capital to carry out new construction, reconstruction, renovation, or repair of housing, technical infrastructure works, and social infrastructure works to serve residential needs at a specific location within a defined time and cost.”
Therefore, in the context of the definitions provided in Article 2 of the 2023 Law on Housing, the authors believe that the regulations concerning the eligible areas for purchase in Article 44 of the 2024 Law on Land are more accurate compared to those in Article 16 of the 2023 Law on Housing. This is because the eligible areas for real estate purchase for residential purposes by Vietnamese origin people residing abroad do not focus on “a set of proposals related to the use of capital” but rather on the classification criteria of urban areas for purchase according to clauses 4 and 5, Article 5 of the 2023 Law on Housing.
2.3. Criteria for a 50-Year Ownership Period with One-Time Extension Not Exceeding 50 Years, and if Ownership Exceeds the Permitted Period without Sale or Donation, the Housing Becomes Public Property
According to points c and đ, clause 2, Article 20 of the 2023 Law on Housing, the rights of foreign individuals permitted to enter Vietnam as homeowners are as follows:
“2. They have ownership rights over housing like Vietnamese citizens but must comply with the following regulations:
…
- c) Foreign individuals can own housing under agreements in transactions involving purchase, lease-purchase, gifting, inheritance, but not exceeding 50 years from the date of issuance of the Land Use Rights Certificate (LUR Certificate), and can extend ownership once for a period not exceeding 50 years if necessary; the ownership period must be clearly stated in the LUR Certificate. In case a foreign individual marries a Vietnamese citizen living in Vietnam, they are allowed to own housing and have the rights of a homeowner like Vietnamese citizens. In case a foreign individual marries a Vietnamese person residing abroad who is allowed to enter Vietnam, they are allowed to own housing and have the rights of a homeowner like Vietnamese people residing abroad.
đ) Before the ownership period of the housing expires as stipulated by this Law, the owner can directly or authorize an organization or another individual to gift or sell the housing to subjects eligible for housing ownership in Vietnam; if the ownership period of the housing expires and the owner does not sell or gift it, the housing becomes public property.”
This regulation introduces a new point: previously, clause 1, Article 4 of Resolution No. 19/2008/QH12 and point c, Article 161 of the 2013 Law on Land also stipulated similarly about the ownership period and added the right to “possibly extend according to government regulations if needed.” However, some opinions suggest that a maximum extension period should be specified so that foreign individuals can own housing for a long term like Vietnamese citizens. Therefore, the National Assembly Standing Committee (UBTVQH) has considered these opinions and added a one-time maximum extension of 50 years to ensure strict regulation (Report No. 661, 2023).
IV. CONCLUSIONS AND RECOMMENDATIONS
It is noteworthy that when Vietnamese origin people residing abroad want to purchase real estate in Vietnam for residential, ownership, and usage purposes, they must comply with the prerequisite condition of being allowed to enter Vietnam, and adhere to specific conditions in accessing the purchase of land use rights (LUR) and housing ownership (HUR), as these have two legal frameworks corresponding to different sets of access conditions.
However, concerning the criteria for areas within housing development projects, clause 1, Article 16 of the 2023 Law on Housing is not aligned with Article 44 of the 2024 Law on Land and Article 2 of the 2023 Law on Housing. Therefore, the authors recommend amending clause 1, Article 16 of the 2023 Law on Housing to read:
“1. …, foreign individuals can own housing, apartments within housing development projects as stipulated in Article 17 of this Law, except for projects in areas that need to ensure national defense and security according to Vietnamese law.” This amendment aligns with the previous direction of Resolution No. 19/2008/QH12 and clearly distinguishes between types of apartments not intended for residential ownership but for business purposes, making it easier to apply in practice.
REFERENCES
- National Assembly. (2008). The 2008 Law on Vietnamese Nationality
- National Assembly. (2024). The 2024 Law on Land
- National Assembly. (2023). The 2023 Law on Housing
- National Assembly. (2023). The 2023 Law on Real Estate Business
- National Assembly. (2008). Resolution No. 19/2008/QH12 dated June 3rd, 2008 of the Socialist Republic of Vietnam
- Đặng Phước Thông. (2020). “Registration of Apartment Ownership upon Request and Some Recommendations to Improve the Law,” Vietnam Journal of Legal Science, No. 03 (133), 2020
- National Assembly Standing Committee. (2023). Report No. 661/BC-UBTVQH15 dated October 22nd, 2023 of the UBTVQH on Explanation, Absorption, and Revision of the Draft Law on Housing (Amended)
- National Assembly Standing Committee. (2023). Summary Report of the UBTVQH dated November 25th, 2023 of the UBTVQH on Explanation, Absorption, and Revision of the Draft Law on Housing (Amended), Section 3, Part 6
- National Assembly Standing Committee. (2023). Summary Report on the Implementation of the 2014 Law on Housing and Orientation for Amending the Law on Housing
- National Assembly Standing Committee. (2024). Report No. 724/BC-UBTVQH15 on Explanation, Absorption, and Revision of the Draft Law on Land (Amended), dated January 14th, 2024
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