In Resolution No. 21-NQ/TW on orientations for amending the Land Law and related laws, the Central Executive Committee requested to stipulate the term of use of apartments in newly built apartment buildings according to the construction term, and at the same time ensure the property rights of the owner.
Commenting on this orientation, Mr. Pham Duc Toan - General Director of EZ Vietnam Real Estate Investment and Development JSC - said that this is a correct policy, in line with reality.
According to Mr. Toan, no project can exist permanently. When the project expires, there needs to be a clear handling mechanism. In fact, even old apartment buildings from 2 - 5 floors high in the inner city are facing many difficulties in renovation and reconstruction due to problems with the rights of households. As long as some households do not agree, the project may be stalled for a long time. Therefore, there needs to be a strong enough legal corridor so that when buildings expire and are no longer safe, the handling can be carried out more smoothly.
Mr. Toan said that the core issue is not the ownership term but the handling mechanism after the project expires. Resolution No. 21-NQ/TW has set out orientations to allow households to contribute funds to rebuild apartment buildings. According to him, this is a solution suitable to reality, and clearly expresses the consistent view that housing first serves the needs of living, instead of being a tool for doing business or hoarding assets.
Regarding the impact on the market, Mr. Toan said that the new regulation will certainly affect the psychology of both homebuyers and investors. Accordingly, one of the biggest impacts is that it is possible to gradually eliminate the group of homebuyers who only aim to speculate and hoard assets. Buyers will clearly define the purpose of buying for living and accept the fact that the value of the apartment will gradually decrease over time, especially when the project approaches the expiration date.
He believes that in the short term, the new regulation may make the liquidity of new projects more difficult. However, in the long term, the market will gradually adapt, buyers' psychology will be more stable and consider this an inevitable development trend.
Regarding house prices, Mr. Toan said that the new regulation may contribute to reducing the average apartment price. Besides, investors will also find it difficult to sell houses at too high prices, except for some projects in the central area. When buyers identify apartments as assets serving housing needs instead of long-term accumulated assets, they will consider more about the real value of the product.
Along with that, when apartment prices decrease, other real estate segments will also be affected. Buyers have more choices and will prioritize products with more suitable prices. This will contribute to helping the real estate market operate more stably and balancedly in the coming time.
The Vietnam Real Estate Market Assessment Research Institute (VARS IRE) believes that the psychology of the majority of Vietnamese people still considers housing as a long-term accumulated asset with hereditary value. People often prioritize the "ownership" and "long-term" factors. Therefore, just the appearance of information related to limiting these two factors can make many people worried that apartments will only be "long-term leases".
According to VARS IRE, stipulating the term of use of apartments according to the lifespan of the project is a direction suitable for the requirements of modern urban development and project life cycle management, and can also contribute to removing bottlenecks in the renovation of old apartment buildings.
However, this unit believes that the effectiveness of the policy does not depend on the time limit regulations, but depends on the level of property rights guarantee, the transparency of the implementation mechanism and the ability to build trust with people as well as the market. Only when these three factors are guaranteed simultaneously can the policy achieve the goal of sustainable urban development, while maintaining the stability and attractiveness of the apartment segment.
