Disclosure: I am not a lawyer, I can not read the Vietnamese legal language. These notes are based upon 20 years of living here and buying and selling property. If you are thinking of buying property, get a good Vietnamese lawyer. If you are thinking of buying a condominium good lawyer AND see a psychiatrist.
Since 1975 April 30, when the Americans flew away, ending the American War in VietNam, no one has owned land in VietNam. The land is 'owned' by all the citizens and held in trust for them by the national government.
The national government has ceded control and use of the land to the provinces who, in turn, have ceded control to districts, wards and communes.
On each level the administration and control is exercised by the appropriate Peoples Committees who are consecutively subservient to the national government. If a provincial PC wants to designate a piece of land as a park, then al the PC's under it are required to go along with it. (They all say 'What a great idea, Prime Minster')
The national government, much to it's credit, has established many national parks, nature reservations, etc. These assignments override all other levels of government.
Simple, the equivalent of a (in the West) is called a User Certificate. These Certificates are issued by the Peoples Committee having jurisdiction over the and in question. These Certificates can be sold (unless frozen - see Compulsory Purchase below), pledged as security and passed on to other family members as inheritance.
Now individuals have a piece of mud, usually delineated square metres, unless it is farm land where it is measured in Hectares.
You then have to get planning permission, from the PC, and then you are in business, at least ready to plan your home or real estate.
If you can get land with a squalid house or building on it, it means you can demolish it and build your palace without further planning permission.
Most every where in the world the real estate mantra is 'Location, Location, Location'. Not so in VietNam For example: in Hoi An there is the 4-star Indochine Hotel, great building on a stub of a side road on the main Hoi An/Da Nang road. Opposite the hotel, on the other side of side road is a large rice paddy. Unless you have been to a rice paddy you don't know just how badly they smell at certain times!
Houses are generally concrete structures that are built on 'lot lines' - in other words every piece ot the land is covered with a house. Villas are a house which has at least a strip of grass all around the house, sometimes even a garden. Condominiums are as you understand them in other countries.
'Selling' a property has two elements: (1) The transfer of the User Certificate or leasehold; (2) The sale of any real property (buildings) existing on the leased land. The of the User Certificate and the of the real property is done at the same time ad registered with the PC. Being Socialist, you cannot imagine the paperwork, the bribes, etc. that are involved.
The value of both the mud and the buildings are determined by barter, just as they are in the West. Since these transactions attract tax, a lot of mosey passes under the table, between the parties so the government doesn't get to tax it all.
Condominiums, whether (row) town-houses or highrises have similar legal structures except in VietNam condominiums, sometimes called strata developments,have three components in VietNam: the land (common element); the common building elements owned and administered by a company whose shareholders are the unit owners in proportion to the size of their unit; and the housing units owned by individual people.
The PC's, never one to miss a fund raising opportunity, sell User Certificates based upon the square metres of your housing unit. The catch is that say an 11-storey building essentially has 11 homes stacked on top of one another and all sharing the same mud under the foundation.
So if the PC designates the value of land under a vertical stack of 11 units, and providing all the units are the same size, each unit pays User Certificate divided by 11 for their share of the and for which they get a user fee.
Parts of the building which are common elements belong to the corporation and they have User Certificates designating it as the holder.
Simple? Not so simple. The condominium transaction are more complex so require a really experienced lawyer.
Even though the civil law structure is very weak in VietNam, some provincial authorities are very proactive using such powers as they exercise to ensure compliance in another area.
Condominium homes are popular alternatives to standalone homes for the same reasons as found in other countries. The difference is they have strong laws.
For example most jurisdictions will nor permit occupation of a new home until a certificate is issued confirming completion.
Here in VietNam things are different. Condominium developers can sell individual condo units to owners and they can inhabit the unit before the Peoples Committee confirmation of a condominium corporation.
Herein lies one of the many traps in Vietnamese condo ownership.
So why should you care?
Utilities for residences are lower than commercial undertakings. These differences are significant and add to unit owner costs.
It'll be OK in a couple of months the salesman says!
Why would believe a salesman?
For example, there is a condominium in Quan 7 where, , is still not registered! The developer has a couple of men doing make up work, as he has for 5 years.
instead the plumber put a 'P' trap in the basement where the building sewage enters the city pipes!
For those not fluent with plumbing, every toilet bowl has water left in it after flushing. The purpose of the water is to stop sewer gases from entering your home. These are 'P' traps.
This not-completed-after-five-years building will require traps, except in my friend's condo where we cut the pipes and installed traps.
How can I check on my building status before purchase?
Go to either EVN (electricity) or the cities water belling department and ask what rates they are charging. If it's Residential, then the condominium building is certified.
A very, very tricky trap awaits the unwary.
If a Vietnamese developer wants to build a highrise development, he buys a User Certificate for the whole plot of land.
However, if a foreign developer wants to build a highrise, they can only rent/lease the land for 2 or 3 years whilst they build. These construction leases can be extended if need be.
Let us assume there are two highrises sitting adjacent to one another, physically alike to each other in all respects, one built by a VN company and the other by a Korean company.
The Vietnamese built condo's are priced USD$5,000 higher than the Korean units.
Based solely on price which would you buy?
The answer lies in the citizenship of the developer. The Vietnamese developer owned User Certificates and after dividing them up as described above who can sell his units off.
Meanwhile the Korean developer similarly sells off his units, gives title to the proud new owners and returns to Korea with his owners feeling happy they got bargains.
Then, surprise, surprise. The HCMC PC then gives all the Korean builders unit owners a nasty shock. A bill for tens of thousands of dollars equivalent for User Certificates per unit.
Why did this happen? Because the Vietnamese builder could actually own the User Certificate whereas the Korean builder was only renting his land from the city. True case, happened in 2009.
As I said, VN land dealings are complex.
HCMC, at least are extremely respectful of their citizens rights. Honestly!
Urban renewal is taking place all over. Roads are being widened, the SaiGon rail terminal is being moved and all these activities require people to be moved, which appears to be easy since no one owns the land.
There is at this writing, in 2011, a simply squalid medium rise slum. It is old and was build when the Americans were here.
HCMC offered owners so much a square metre and a few accepted and moved out. The rest stayed and demanded more money. the city blinked and offered yet higher amounts, and even more accepted and moved out.
Finally there were 5 families demanding more money per square metre. The city blinked again and all the people moved out. No compulsory purchase.
When the city wants to acquire land subject to User Certificates it places an embargo on the transfer of any Certificates except their return,for market value,
However, some unscrupulous owners have gone ahead and sold their properties, and User Certificates, in effect defrauding the new 'owner' as the sale is illegal.
Make sure, if you buy land your lawyer is deadly careful about checking out development zones!
The answer is a qualified Yes.
(1) Acquire User Certificates in Ha Noi, Da Nang and HCMC - at the moment;
(2) Hold the User Certificate for 75 years at which time it, and the buildings on it revert to the PC and the former owner gets nothing.
Vietnamese boat people, and their offspring, are called Viet Kieu or overseas Vietnamese. A days worth of form filling photographs, fingerprints makes a VK a fully fledged citizen with all the rights, and obligations, of a citizen. They can also retain any overseas citizenships they have acquired.
True Foreigners are any people who have no blood connections or hereditary connections with a Vietnamese.
Example. I helped a woman regain her VN rights. Her father fought for the French and before they left they took many of the men back to France. Her Father married a divorced French woman who had a daughter. The VN man and the French woman had two more daughters. One daughter married a Moroccan and has three children.
The woman, as well as her children, are considered Viet Kieu and they all now carry VN and French passports! They also have the right to hold regular User Certificates.
VietNam has very strong property rights and in the case of a divorce, the split is 50-50.
The obvious thing in this case is for the User Certificate to be in the VN spouse' name. This leaves the Foreigner, whose money was likely used to by the User Certificate/real property with no assets.
My wife is Vietnamese and all the User Certificates are in her name. However, she assigned me exclusive land management rights including a provision that the land cannot be transferred without mt written consent and that the proceeds shall be shared equally. This wasn't my decision, she told the lawyer it should be done this way.
Dictated and transcribed using my Android smartphone.