Buying property in Vietnam

Updated 2023-11-19 11:04

If you are planning on staying in Vietnam for a significant amount of time, buying a condo or getting involved in a commercial investment might be worthwhile. In this article, we are going to share several pieces of important and up-to-date information on the process of purchasing property in Vietnam.

Foreigners are eligible to invest in new housing construction projects, buying, renting, or inheriting houses, and buying or investing in apartments and secure properties like villas or townhouses. Keep reading to learn more about the guidelines and regulations in place for foreigners and buying property in Vietnam.

Who can buy property In Vietnam?

Legally, in Vietnam, land use rights are granted to land users by the Vietnamese government on behalf of the landowner. At present, foreigners are legally able to buy property in Vietnam in the form of a house, apartment, building, or commercial space investment. They are restricted to only owning up to 30% of the units within an apartment complex or 250 landed properties in an administrative ward and cannot own houses independent of a complex or designated commercial building. These rules come from foreigners not being considered legal “land users” per the government definition in Vietnam and not being eligible for land allocation, land leases, or recognition of land use rights by the state. It's important to stress that no foreign company or individual can own, rent, inherit, or buy upwards of 30% of units in a traditional ward system or apartment building.

Depending on who buys the property, the length of ownership differs slightly. Foreign-owned companies, on the other hand, have the right to own property for as long as they retain their investment license in Vietnam.

How to buy property in Vietnam

There are numerous means of successfully buying a property in Vietnam, and we will focus on the most common.

  1. Inherited through marriage: If your spouse already owns property in Vietnam, upon receiving the marriage license, you can also own the property for the same amount of time remaining on the lease and have the same rights as your new spouse.
  2. Buying as a foreign individual is realistic in practice. However, the first term of ownership is not allowed to exceed 50 years in duration - with the option to renew. This would be buying property through a broker as an independent foreigner and not a legal entity. Once you have registered your newly purchased property with the local tax authority, you are permitted to sublet.
  3. Forming a joint venture in Vietnam is the second option available to foreigners, and means a Vietnamese partner is mandatory. Joint venture companies have the right to buy households and buildings for lease or sale. Be sure to apply due diligence when selecting your Vietnamese nominee. If they are not reliable or trustworthy, you could encounter a number of terrible consequences later.
  4. Setting up a company that is 100% foreign-owned is another common way of buying property in Vietnam. Doing this will give you the freedom to lease land and construct warehouses, factories and commercial buildings. Unfortunately, establishing a company won't give you the right to sell or lease the properties you build but not to sell or benefit from the purchase of said property. The only way around this would be to establish a real estate company in Vietnam.

Where to find property listings in Vietnam?

Now that you've decided to buy property in Vietnam, it's time to discover your perfect listing. There are a few trusted websites that you can explore. Savills Vietnam, DotProperty, and CBRE have up-to-date listings of residential and commercial properties situated across the country and across budgets, starting at 3 billion VND (US$ 123,330) and going up to 450 billion VND (US$ 18,499,500). Take your time and work with designated and licensed agents to find exactly what you are looking for. We do recommend using an experienced company as they will be familiar with the process and litigation. If you are marrying a Vietnamese citizen, do not be surprised if a new aunt or an uncle has “an incredible deal for you,” but do not hesitate to tell your spouse you want to be patient and not make any quick decisions.

There are a few things to look out for when making a commercial or residential purchase in Vietnam:

  1. Always make sure the seller of the property has the “pink book” in their possession. It is important you physically see the book before signing any contracts to ensure this person is legally able to sell the space. The “pink book” is also the certificate of proprietorship and issued by the Vietnamese government.
  2. Ensure all contracts are translated from Vietnamese to English, and all copies have both languages. You are entitled to a contract that you can understand and should not agree to anything written only in Vietnamese.
  3. Taxes! Remember that PIT (personal income tax) is a flat rate tax on the resale of a property and an estimated 2% of the transaction value. This is the seller's responsibility. For a new buyer, you will be responsible for Value Added Tax (5% of property value for social housing and 10% for commercial housing), Registration Tax (0.5% of the property value), and Land Tax (an estimated 0.03% to 0.15%, depending on the land size and price per square meter).

Although buying a property in Vietnam isn't the most complicated process, registering can take up to two or three months. Be sure to consult with a lawyer specializing in real estate and acquire the correct guidance before signing contracts or finalizing deposits.

Useful links:

Clarifying rights of foreign individuals to own property in Vietnam

The Real Estate Business For Foreign Invested Enterprises In Vietnam - Some Key Factors - Lexology

Expat Guide to Buying Property in Vietnam - Savills

We do our best to provide accurate and up to date information. However, if you have noticed any inaccuracies in this article, please let us know in the comments section below.