The Prime Minister has just requested ministries and branches to promptly submit a decree providing detailed guidance on the implementation of the revised Land Law (Land Law 2024). This is the basis for the Government to propose to the National Assembly to allow the law to take effect from July 1, instead of January 1, 2025 as approved earlier this year.
Many experts say that if this proposal is passed and the Land Law is soon applied, it will have a positive impact on real estate prices, especially in segments that are showing signs of heating up every day, such as apartments and houses.
Mr. Le Hoang Chau, Chairman of the Ho Chi Minh City Real Estate Association (HoREA), emphasized that the 2024 Land Law, implemented half a year earlier, will promote the development of market supply, thereby lowering housing prices.
Recently, the prolonged shortage of apartment supply has pushed up the price of apartments in Hanoi abnormally high, even in suburban areas, the selling price is 60-70 million VND/m2, equal to the price of land. In the city center, there are projects with prices of nearly 300 million VND/m2.
According to research by PropertyGuru Vietnam, recent new projects only contribute about 20,000 - 30,000 apartments per year, while the normal demand is up to 70,000 - 80,000 apartments/year.
The early implementation of the Land Law could help curb real estate prices, including apartment prices which are currently very high. (Illustration: Cong Hieu)
According to Mr. Chau, one of the new regulations of the Land Law that people and investors are particularly interested in is the pilot implementation of commercial housing projects through agreements to receive land use rights or have other land use rights.
If the law is implemented soon, it will create favorable conditions for investors to access land more easily, develop projects faster; contribute to solving the problem of lack of housing supply in the market. Notably, thousands of real estate and commercial housing projects that are facing difficulties will be resolved.
Therefore, in the context of a market lacking supply while demand remains high, clearing the way for stuck projects is expected to contribute to stabilizing the currently very high real estate prices.
Sharing the same view, Dr. Nguyen Van Dinh, Chairman of the Vietnam Association of Realtors (VARS) further analyzed: The Land Law coming into effect soon will help many projects to be quickly cleared of obstacles for implementation and completion. From there, the supply for the market will increase, contributing to reducing the current pressure on supply and demand. From there, housing prices will gradually decrease to a reasonable level, more suitable for people's income.
In addition, when investors have easier access to land, the cost of project development also has the opportunity to decrease thanks to the shortened legal completion process. The selling price of the product has the opportunity to be adjusted.
VARS leaders also forecast that the residential real estate segment, especially social housing and affordable commercial housing, will play a pivotal role, leading the entire real estate market from mid-2024. The industrial real estate segment will continue to grow based on the impressive results achieved in 2023.
Meanwhile, the tourism and resort real estate segment still faces many challenges and will need to turn things around if the tourism industry really achieves impressive results. The commercial real estate segment will not have many fluctuations.
Mr. Nguyen Anh Que, Chairman of G6 Group, Member of the Executive Committee of the Vietnam Real Estate Association, also said that when the Land Law 2024 comes into effect soon, along with the Housing Law and the Real Estate Business Law 2023, it will resolve problems for real estate projects that are slow to be implemented.
In particular, social housing projects will have their shortcomings resolved, from investment policy procedures to planning approval, land allocation, and construction permit approval, which will be more open than in the previous period.
" This could cause the supply of social housing to "explode" in the coming time, especially in large cities like Hanoi and Ho Chi Minh City, to meet the current great demand. Apartment prices in large cities will also be held back, no longer at such a high level as in the past, " Mr. Que commented.
Meanwhile, Mr. Nguyen The Diep, Vice President of Hanoi Real Estate Club, expressed his opinion: The sooner the Land Law takes effect, the more favorable conditions will be created to open a new development phase of the real estate market.
In particular, removing the land price framework will help businesses accelerate site clearance progress, eliminate weak businesses, and benefit people when their land is recovered.
" If the Land Law is applied early, the supply in the market will improve sooner. The more apartment and housing segments will help reduce housing prices, creating favorable conditions for low-income people ," Mr. Diep commented.
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