The maximum value the seller can collect when the buyer has not yet been issued the Certificate of Land Use Rights?
Maximum amount the seller can collect when the buyer has not yet been issued the Certificate of Land Use Rights?
Pursuant to Article 57 of the 2014 Law on Real Estate Business, which stipulates Payments in transactions of future-formed real estate as follows:
- Payments in transactions of future-formed real estate are made multiple times, with the first payment not exceeding 30% of the contract value. Subsequent payments must match the construction progress of the real estate, but the total amount must not exceed 70% of the contract value before the house or construction works are handed over to the buyer. In the case where the seller or lease purchaser is an enterprise with foreign-invested capital, the total amount must not exceed 50% of the contract value.
In the case where the buyer or lease purchaser has not been issued the Certificate of Land Use Rights, home ownership, and other property attached to the land, the seller or lease purchaser may not collect more than 95% of the contract value. The remaining value of the contract is to be paid when the competent state agency has issued the Certificate of Land Use Rights, home ownership, and other property attached to the land to the buyer or lease purchaser.
- The investor must use the pre-paid money from the customers strictly according to the committed purposes.
Thus, according to current regulations, the seller may not collect more than 95% of the contract value when the buyer has not yet been issued the Certificate of Land Use Rights.
What conditions must future-formed real estate meet to be put into business?
Pursuant to Article 55 of the 2014 Law on Real Estate Business, which stipulates the conditions for future-formed real estate to be put into business as follows:
There must be documents on land use rights, project dossiers, construction drawing designs approved by competent authorities, a construction permit in cases where a construction permit is required, and documents on acceptance of the completion of technical infrastructure corresponding to the project progress. In the case of apartment buildings and mixed-use buildings with residential purposes formed in the future, there must be a foundation completion acceptance record.
Before selling or lease purchasing future-formed houses, the investor must notify the provincial housing management agency in writing about the houses eligible to be sold or lease purchased.
Within 15 days from the date of receipt of the notice, the provincial housing management agency is responsible for providing written feedback to the investor regarding the houses' eligibility to be sold or lease purchased; in cases where the conditions are not met, the reasons must be clearly stated.
Respectfully!
