Burden of land use fees
The People's Committee of Ho Chi Minh City has just issued a new land price list effective from October 31, 2024 to December 31, 2025. According to experts, compared to the land price list of the draft adjusted land price list (draft land price list) announced by the Department of Natural Resources and Environment on July 29, 2024, the land price list in the decision of the People's Committee of Ho Chi Minh City on October 22 (new land price list) has been adjusted and changed more reasonably.
The new land price list has been synchronously adjusted from the highest land price to lower land prices in each district, Thu Duc City according to each land location and adjacent land locations of each locality.
However, people who have agricultural land but have not yet converted the land use purpose are very worried about the burden of land use fees.
Mr. Doan Quoc Viet, residing in Phu Huu Ward, Thu Duc City, said that he owns a 120m2 agricultural land plot right on the frontage of Lien Phuong Street in Thu Duc City (HCMC). In early 2024, when he planned to change the land use purpose to build a house, he calculated that he would have to pay nearly 500 million VND in land use fees. But now the calculation has been reversed, it is expected that according to the new land price list, he will have to pay more than 2 billion VND. Previously, he bought this land plot for nearly 2 billion VND, now with the amount of land use fees he has to pay, it is like he has to buy back his own land.
Not only the people, many businesses in Ho Chi Minh City are also "restless" before the risk of skyrocketing land rents if the new land price list is applied. Because there are roads where the price has increased sharply up to dozens of times, from a few million to tens of millions of VND per square meter. This means that land rental costs have also increased quite sharply.
Will have an impact on real estate prices
Mr. Le Hoang Chau - Chairman of the Ho Chi Minh City Real Estate Association (HoREA) - commented that the new land price list ensures fairness between those who have fulfilled their financial obligations to pay land use fees in the first 10 months of 2024 and those who will fulfill their financial obligations to pay land use fees from the effective date of the decision from October 31, 2024.
In terms of the market, Mr. Le Hoang Chau said that the assessment of the new land price list will not immediately affect the real estate market because current real estate and commercial housing projects are mainly priced according to the surplus method. However, it will affect the real estate market at the stage when real estate enterprises receive land use rights transfers to implement real estate, urban, commercial housing and social housing projects, people will have the mentality of wanting to sell at higher prices than before, leading to pressure to increase housing prices.
Therefore, Mr. Chau proposed that the State take effective measures to control the activities of speculators, land brokers, and dishonest businesses who may take advantage of the new land price list to increase and inflate land prices, disrupting the market for the purpose of illegal profiteering.
In addition, with increasing land prices, land use fees will also increase. Therefore, Mr. Le Hoang Chau suggested that the Department of Natural Resources and Environment pay attention to cases of land users who are adversely affected by the new land price list, including: Individuals who need to apply for recognition of residential land use rights, first of all, more than 13,000 land plots for which land users have not been granted the first Certificate. Land users who request to change the land use purpose for agricultural land and non-agricultural land in the same plot of land with houses, while the land area for housing construction has a "pink book" located in urban areas and rural residential areas.
Especially for individuals and households with land and houses located in suspended planning areas, typically the Binh Quoi Thanh Da project, for many years, people have had their land use rights suspended. If the suspension is lifted, they may be disadvantaged a second time when they may have to pay higher land use fees than before.
