Regulations on the sale, lease purchase, and lease of social housing in Vietnam

Regulations on the sale, lease purchase, and lease of social housing in Vietnam​ (Image from the Internet)

1. Regulations on the sale, lease purchase, and lease of social housing in Vietnam

The sale, lease purchase, and lease of social housing in Vietnam are stipulated in Article 89 of the Housing Law 2023 as follows:

- The sale of social housing is conducted according to the following provisions:

+ Social housing formed in the future can only be sold when complying with Clause 3, Article 88 of the Housing Law 2023; available social housing can only be sold when complying with Clause 4, Article 88 of the Housing Law 2023;

+ The purchase and sale of social housing must be established as a contract with the contents specified in Article 163 of the Housing Law 2023;

+ The advance payment by the purchaser of social housing is implemented according to the agreement in the housing sale contract, matching the completion rate of the building construction and the project progress approved but the initial advance payment must not exceed 30% of the contract value including any deposit (if any), and the total amount of all payments must not exceed 70% of the contract value prior to handing over the housing to the purchaser and must not exceed 95% of the contract value before the purchaser is issued a Certificate for that housing;

+ The purchaser of social housing is not allowed to resell the housing for a minimum period of 05 years from the full payment date, except in the case specified in Point dd, Clause 1, Article 89 of the Housing Law 2023;

+ Within 05 years from the date of full payment for social housing, if the purchaser wishes to sell this housing, it can only be resold to the social housing project investor or to an eligible social housing buyer with a maximum price equal to the social housing price in the purchase contract with the social housing project investor. Personal income tax payment is made according to tax law regulations;

+ After the 05 year period, from the date of full payment for housing, the purchaser of social housing is allowed to resell the housing on a market basis to a person in need if a Certificate has been granted; the seller does not have to pay land levy but must pay income tax as per tax law regulations, except for selling social housing as an individual house where the seller must pay land levy as per the government regulations and income tax as per tax law regulations.

- Hire purchase of social housing is implemented according to Points a and b, Clause 1, Article 89 of the Housing Law 2023, along with additional regulations:

+ The minimum payment period for hire purchase of social housing is 05 years from the contract signing date;

+ Social housing hire purchasers are not allowed to resell the housing for 05 years from full payment according to the period specified in Point a, Clause 2, except for cases specified in Point c, Clause 2, Article 89 of the Housing Law 2023;

+ Within 05 years from the full payment date, if the hire purchaser needs to sell this housing, it can only be resold to the housing management authority in case of public investment or to the social housing project investor in non-public investment cases, or to an eligible social housing buyer with a maximum selling price equal to that in the contract with the housing management authority or the social housing project investor. Personal income tax is handled according to tax law regulations;

+ After the period of 05 years from the full payment date, the hire purchaser may resell the housing on the market basis as regulated in Point e, Clause 1, Article 89 of the Housing Law 2023.

- The rental of social housing is carried out under the following provisions:

+ The rental of available social housing is only carried out when complying with Clauses 4 or 5, Article 88 of the Housing Law 2023;

+ Social housing rental must be formed into a contract with the terms stipulated in Article 163 of the Housing Law 2023;

+ Contracts cannot be signed for housing rentals forming in the future. In cases where the housing meets the conditions stipulated in Points a and b, Clause 3, Article 88 of the Housing Law 2023, the social housing project investor may only sign deposit contracts and collect a maximum 12-month rental deposit; the deposit contract must ensure the correct subjects and conditions eligible to rent social housing as stipulated in the Housing Law 2023; after the housing meets the conditions at Clause 4, Article 88 of the Housing Law 2023, the social housing project investor may sign a rental contract with the tenant.

2. Regulations on the management and operation of social housing in Vietnam

According to Article 90 of the Housing Law 2023, the regulations on the management and operation of social housing in Vietnam are as follows:

- For social housing invested with public funds, the authority as defined in Article 14 of the Housing Law 2023 decides the selection of the housing management and operation unit as per Clause 5, Article 125 of the Housing Law 2023. For social housing invested by union financial resources, the Vietnam General Confederation of Labour decides on the selection of the management unit by its authority; if there are two or more registered units participating, the rules of competitive bidding are applied to select the management and operation unit.

- For social housing invested without public funds or union financial resources, the management and operation are regulated as follows:

+ Social housing for rent is managed and operated by the project investor, or they can hire or entrust a capable management unit to operate the housing according to the Housing Law 2023;

+ Social housing for hire purchase is managed and operated by the investor during the hire purchase period as per Point a of this Clause; once the hire purchaser has fully paid, the management conforms to Point c, Clause 2, Article 90 of the Housing Law 2023;

+ For social housing for sale, the buyer manages and operates if it's an individual house; for apartments, the operation must comply with condominium management regulations as defined in the Housing Law 2023.

- The operation and management of social housing enjoy preferential treatment similar to public utility services.

- The social housing management unit has the right to conduct other business services within the social housing area not prohibited by law to reduce management and operation service costs.

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