How do you invest in Vietnam real estate?

colinoscapee wrote:

We just bought a block of land, sold it 4 months later with a 40% profit. Why? Many Vietnamese over extend themselves, repossessions are rife, thats how why we bought it. My partner does this a couple of times a year, due to the large amount of repossessions taking place. The average local has very little understanding of buying property and holding it.

A couple of weeks ago, i googled something like "land for sale in vietnam" and as it happens came across your ad somewhere and recognised your name. Your wife has done well if she sold it for 40% profit and it was the same piece of land at that asking price.

How does one find repossessions in Vietnam? got any tricks or advice? Is it even possible online? I love a good repossession, my apartment in London was a repossession and the single best investment I've made so far. In the UK, it's mandatory for estate agents to put out a public notice when they receive the highest offer so you can google "Public notice" along with the area your interested in with "for sale" and you'll get a list of all repossessed properties you can bid for.

Are there anything website or online tricks to finding them?

And if a foreigner can not buy from a Vietnamese then how are these repos bought? This suggest you can buy from a VNese lender.

My partner,who is not my wife, has bought land many times here,so she has a history of buying and selling. As with most things in VN she hears about it through people she knows.

Got it.

the best way to invest in Viet Nam that you buy an apartment and then for rent or resell to other foreigners. It is good to earn money

Why would a foreigner buy your foreign owned apartment when they only inherit the remaining 50 year lease length from you?

Why would they buy from you instead of the local flippers?

Good luck finding someone to buy your apartment when any local with money to invest is only interested in flipping these flats before they are completed or buying strips of land next to yours. Why would anyone buy it when there's thousands of new apartments and projects coming into the market.

Thats the Vietnamese condo trap.

FYI.  You can't buy apartment from locals in the secondary as locals' are freehold, but you can sell your leasehold apartment to both locals and foreigners.  Locals will get it converted to freehold from leasehold automatically while foreigners will continue to get it as leasehold.  More liquidity in the secondary for foreign investors who buy from developer.

Secondary liquidity?

No foreigner would ever buy a property from another foreigner if they only get the remaining years of a 50 year lease. Aren't they effectively limiting the resale market for foreigners...

I don't think there is any freehold property in Vietnam. Land is considered a national asset and not a personal asset. Hence the ability to have a leasehold. Maybe they have changed the laws.

Diazo wrote:

I don't think there is any freehold property in Vietnam. Land is considered a national asset and not a personal asset. Hence the ability to have a leasehold. Maybe they have changed the laws.

As far as I know you are right.
But I think that's a matter of interpretation.
Or can you tell me what the real difference between ownership and perpetual land use rights is?

We have a pink book that says:
Thời hạn hạn sử dụng: Lâu dài
According Google Translate "Lâu dài" means "lasting" or "durable".

Andy Passenger wrote:

Or can you tell me what the real difference between ownership and perpetual land use rights is?

No real difference aside from semantics. For all intents and purposes, the land is freehold for locals because unlike a perpetual lease;

1. you do not lose occupancy or ownership rights when it expires
2. the actual land is transferred during sales
3. the locals receive compensation for the land during eminent domain rulings

And while it is technically freehold, property tax is only paid in the form of a lease renewal, once every 50 years. If the lease is not renewed, you will not be able to use the land as collateral when applying for a loan nor will you be able to sell/transfer the land to a buyer/beneficiary.

It is certainly not a matter of semantics in legal terms. But what Kuoo describes is certainly not freehold but indeed leasehold. The fact remains ( unless someone can show me where and when the law changed) there is no freehold in Vietnam. As with any communist country. The belief that you do not lose owenership or lease rights when the leasehold ( freehold) expires is misguided I think. If you did not what was the purpose of putting a limitation in terms of time ( 50 years) . You could just make it freehold and you would own it in perpetuity. As for the legal lingo in a house book her I have no experience with the language.

I am little confused.

I agree with Diazo on the point that everyone (locals and foreigners) has only land ownership rights (not ownership).
The only difference will be that the locals have the right to use land forever and the foreigners only for 50 years.

I assumed that by "I don't think there is any freehold property in Vietnam" Diazo means everyone (locals and foreigners). Because I already know that with the 50 years limit for foreigners.
That's why I wrote that ownership and unlimited land use rights (for locals) make no real difference.

In our case, the 50 years limitation does not apply because we bought the land in my wife's name.

By the way, we bought (from a Vietnamese citizen) two small pieces of land next to each other.
In one pink book was written "Thời hạn sử dụng: Lâu dài".
In the other was written "Thời hạn sử dụng: Đến tháng mm/20yy".
"Thời hạn sử dụng" means about "duration of use".
In addition, the sales contract is entitled "Chuyển Nhượng Quyền Sử Dụng Đất" (transfer of land use right.
That tells me that the Vietnamese seller also only had land use rights.

Indeed Andy.....he had the rights to USE the land...not to OWN the land. And in a leasehold country everyone just get the right to USE, not own. So when you bough the landlord conveyed unto you the right house the land for the duration of their lease or unless you got a new 50 year lease. And then to the gov't can put a hold on your right to do anything to the property and that covenant will be entered into the records for your property. We have several in a section of my city that Han Noi gave notice ton that the gov't could take the property with 90 days notice. This is one reason it is always good to do a lease or a purchase through a notary. I have ran into many wannabe landlords who's house book is held by the bank. They put a covenant on it telling anyone who might think about occupying the property that the bank can boot them out with 90 days notice.
Not to worry about it all. Most who are on this forum probably will not outlive their 50 year lease. And for the foreigner he does not own anything anyway in terms of houses. The bride owns it.

Andy Passenger wrote:

I agree with Diazo on the point that everyone (locals and foreigners) has only land ownership rights (not ownership).

Then you actually agree with me! You understand that freehold (legally) refers solely to land ownership rights not true ownership, correct?

True ownership does not exist in America or developed Western countries due to the fact that eminent domain also exists in these countries, much like in Vietnam. The lands either belong to the Queen/King or the government.

Andy Passenger wrote:

The only difference will be that the locals have the right to use land forever and the foreigners only for 50 years.

Yes, they (locals) have perpetual land use rights until eminent domain kicks in, just like in freehold America!

Diazo, however, associates locals paying property taxes and renewing their deed every 50 years  in Vietnam with “leasehold country ” while associating annual property taxes in America with “freehold country” because only one of these countries is Communist.

Semantics.



@Diazo

There are no legal terms here unless you're referring to the Vietnamese legal terms. Your Western legal terms are irrelevant when dealing with citizens (not foreigners) and local land ownership laws. I'm not sure why you keep pushing your "legal terms" in Vietnam when discussing local ownership which, by the way, is also the incorrect term for the form of home and land ownership used in Vietnam.

It certainly is a matter of semantics.

You need to accept the fact that the Vietnamese government use their own system (shock), which frankly, is the only thing that matters to them as well as the citizens. You also need to accept the fact that locals are able to sell/transfer their land and personally receive compensation for the land during eminent domain rulings just like Americans!

Diazo wrote:

If you did not what was the purpose of putting a limitation in terms of time ( 50 years) . You could just make it freehold and you would own it in perpetuity.

As previously stated... It is a form property tax ($$$) and the its main purpose is to allow the local government to keep up-to-date record of the current owners.

“But how is it ‘up-to-date' if renewal only occurs every half-century?”

Being unable to use the land as collateral or transfer/selling it on an expired deed will require the current owner/beneficiary to update it ASAP.

Diazo wrote:

As with any communist country. The belief that you do not lose ownership or lease rights when the leasehold ( freehold) expires is misguided I think.

Laws and legal procedures vary from country to country so that statement is not only ignorant but also incorrect in Vietnam.

Diazo wrote:

I have no experience with the language.

In response to a post discussing local ownership... Why am I not surprised?

Honestly, Diazo, you need to lose this fixed mindset (my way or the highway) and accept that you can be wrong or just not knowledgeable or experienced enough to discuss this specific topic... Why apply mental gymnastics and argue legal semantics (between countries) in an attempt to convince yourself or others that you are right?

Diazo, you (a tourist) either buy a condo and find out if the lease is perpetual or terminating or you don't. As a tourist, you will not be able to buy a piece of land, a house, or villa in Vietnam under your name, at least not in your lifetime. Really, that's basically all foreign buyers (tourists) posting here need to know. Whether or not they can afford it or successfully flip the condo is entirely up to them.

With that said, there should be no need for you to bump this thread every time it dies in order to repeat your stance/opinions/questions ad nauseam under the guise of a fostering an “open” discussion. Sad.

I will not be enabling your behavior so get the last word in and preach it to the choir. Also, don't waste your time with a PM this time -  my inbox is disabled. 

Kupo wrote:

Andy Passenger wrote:

I agree with Diazo on the point that everyone (locals and foreigners) has only land ownership rights (not ownership).

Then you actually agree with me! You understand that freehold (legally) refers solely to land ownership rights not true ownership, correct?

True ownership does not exist in America or developed Western countries due to the fact that eminent domain also exists in these countries, much like in Vietnam. The lands either belong to the Queen/King or the government.

Yes, I generally understand the difference between "freehold" and "ownership".
But because I am not a native English speaker it can sometimes happen that I don't meet the right English words.   

Since eminent domain can take place more or less everywhere (even in my country), I don't think you have to mention this explicitly when talking about perpetuity land use rights.

Speaking of expropriation:
https://www.theglobaleconomy.com/rankin … tion_risk/

@kupo
In many ways your a tad bit confused. At any rate there are people that really do not subscribe to your views or understanding of freehold and leasehold. Here is a link that reiterateswhat I have said:

https://www.globalpropertyguide.com/Asi … ying-Guide

@andy
It seems as if you have a clear understanding of “freehold”, “leasehold” as well as “ eminent domain”.
Eminent domain is a process that can be used by every government in the world as far as I am aware. In general it is used in most countries to take land for the common good of all the people. For example the mass transit system in HCM, or the building of a new freeway in say America. And this process can be used either for freehold or leasehold during the time when the existing owner either owns the land outright “freehold”, or when they are allowed to use the land for a specified period of time “ leasehold”. But none of the terms are a semantic argument. They are independent legal terms designed to fulfill a particular purpose and are not interchangeable.
Interesting link you provided by the way. Glad to see Vietnam tank so highly. There is no doubt there are great opportunities here and VN and the progress is moving forward very well. I do not think the two ideologies between “freehold” and “leasehold” matter one heck of a lot for the average person. I bought my first “ freehold” property at age 20. Had it been “ leashold I doubt I would have been fretting terrible at the age of 70 ( 50 year lease) if the g opted not to renew my lease. And probably most VNese are not buying at age 20.
Please don't misunderstand my reason for “ bumping” the thread. I have no skin in the game so to speak. As I have no intentions of buying in VN under the present concept for foreigners. Nor is it my way or the highway. I only chime in to make the point in regard to “freehold” and  “ leasehold”. I really do not see them as confusing legal terms. When you lease or rent anything I think most understand you are getting the item for a defined period of time. I lease my house. We all understood when we signed the lease that I had the right to use the property that someone else had title to for a given amount of time.
  Eminent domain is a completely different issue and should not even be in the same discussion perhaps. In practical terms eminent domain seems reasonable and necessary. In America it had worked since our founding. That is it was used to take land for the common good of all the public . But that was upended when they started allowing private or public companies take land . The Supreme Court upheld this. Which was a sad day for eminate domain in America. I can not recall the partialular case. But since that ruling may developers had taken large swaths if land to build a mall “ for the overall good of the public “.

Diazo wrote:

@andy
It seems as if you have a clear understanding of “freehold”, “leasehold” as well as “ eminent domain”.
Eminent domain is a process that can be used by every government in the world as far as I am aware. In general it is used in most countries to take land for the common good of all the people. For example the mass transit system in HCM, or the building of a new freeway in say America. And this process can be used either for freehold or leasehold during the time when the existing owner either owns the land outright “freehold”, or when they are allowed to use the land for a specified period of time “ leasehold”. But none of the terms are a semantic argument. They are independent legal terms designed to fulfill a particular purpose and are not interchangeable.
Interesting link you provided by the way. Glad to see Vietnam tank so highly. There is no doubt there are great opportunities here and VN and the progress is moving forward very well. I do not think the two ideologies between “freehold” and “leasehold” matter one heck of a lot for the average person. I bought my first “ freehold” property at age 20. Had it been “ leashold I doubt I would have been fretting terrible at the age of 70 ( 50 year lease) if the g opted not to renew my lease. And probably most VNese are not buying at age 20.
Please don't misunderstand my reason for “ bumping” the thread. I have no skin in the game so to speak. As I have no intentions of buying in VN under the present concept for foreigners. Nor is it my way or the highway. I only chime in to make the point in regard to “freehold” and  “ leasehold”. I really do not see them as confusing legal terms. When you lease or rent anything I think most understand you are getting the item for a defined period of time. I lease my house. We all understood when we signed the lease that I had the right to use the property that someone else had title to for a given amount of time.
  Eminent domain is a completely different issue and should not even be in the same discussion perhaps. In practical terms eminent domain seems reasonable and necessary. In America it had worked since our founding. That is it was used to take land for the common good of all the public . But that was upended when they started allowing private or public companies take land . The Supreme Court upheld this. Which was a sad day for eminate domain in America. I can not recall the partialular case. But since that ruling may developers had taken large swaths if land to build a mall “ for the overall good of the public “.

For me personally it does not matter whether the land use rights is for 50 years or perpetual.
It's only important for my wife and our future children.

I simply wanted show in the post #210 that in the pink books is written about perpetual land user rights and not about land freehold.

I see. And understandably so on all accounts. Do not know how old your wife and childern are. But there is no reason to believe that the gov't will not renew their lease many many times. But the gov't does exercise that right to take back the land after 50 years. Hey, it is a step forward. At one point the land always was their and you were allowed to put your dwelling on it. The 50 years give you some recourse. I think if one researched the issue here you would find there was no such thing as eminate domain. The gov't exercised absolute cntr of the land and they decide what it was going to be used for tomorrow.
I am sure your family will enjoy the property for many decades and perhaps hundreds of years to come.

The below link is the legal history of land ownership in Vietnam. It seems to be fairly straight forward and easy to understand ( I think):

http://vietnamlawmagazine.vn/land-owner … -4410.html

Hello everyone,

Please note that some off-topic posts have been put aside from this thread.

all the best,
Moderator

Sheesh, this is one of those expat 'threads with no consensus". Several experts who mean well but due to murky Vietnamese laws, have conflicting opinions.

The 50 year foreigner purchase rule was enacted in 2017. The youngsters among us won't find out the truth until the first property comes up for renewal in 2067 or later. Unless there is a new rule before that date (likely ).

I've got an attorney friend that I asked the same questions. First,  there is a difference between land and property.  Land is owned by the government and Vietnamese citizens can buy it from the government, but foreigners cannot. However,  foreigners can own property, such as a house or an apartment.  The property has a 50 year lease with an automatic 49 year renewal.

As an FYI I own a house and I am buying an apartment so I walked the walk.

When you invest here you just own it for 50 yrs with apartment. I just think that's an easy ways to invest here. It's difficult if you invest in land if you have husband is Vietnamese or some friend you can trusted in ( but I think it will not possible). Apartment you can find a good brand like Novaland, Hoang Anh Gia Lai or Vinhomes (there are a good brand in real estate in VN). You can buy apartment $150,000 - $180,000 in D2 or Binh Thanh District and for rent it. price for rent will range in $1600 - $2500/month.
after 5 yrs maybe you can get back your all money and have a good profit after that.

****

And if you read the above legal article it seems that your attorney friend contradicts current Bietnamess law. Where the article says that leasehold is ALMOST like ownership, it is in fact not.
  I suspect for all practice purposes the way leashold currently operates here it is indeed a great deal like freehold. Whereas in freehold states you hav eminate domain, here the gov't has th right to do the same thing. The renew of the lease is almost autimatic but it is not.
  It would be more reassuring if there were 50 years of practice experience in the practice of 50 year leashold. But I imagine for the average expat and their age it would not be much of a factor.
  Yet still there is still the unknown factor of the new law of foreigners owning homes. While the law is in place the most current I have heard is that no one has yet had a house book issued in a foreigners name.
  Did see a report that surprised me the other day and that was that the Philippines topped the list of best places on earth to invest in real estate. Who would have thunk it

Diazo wrote:

And if you read the above legal article it seems that your attorney friend contradicts current Bietnamess law.

Is this a Freudian typo?   

Diazo wrote:

Whereas in freehold states you hav eminate domain, here the gov't has th right to do the same thing.

I expect that government's right of eminent domain exists in every country on earth, although it may be more codified in some.   The US Constitution guarantees "just compensation" in the lesser know part of the 5th Amendment.  The usual contention is whether the amount of compensation is just and fair.   Until fairly recently, most US jurisdictions compensated based on taxable valuation which is usually a lot less than fair market value.  Only in relatively recent years most, if not all, US jurisdictions use fair market value.

I believe that a lot of past conflicts over eminent domain in Vietnam have similarly revolved around the amount of the compensation.  That too may be changing.  My wife seriously considered purchasing a small home down a dirt lane in Thu Duc because it was in the path of a proposed highway and the amount had already been pegged at an amount higher than the seller was asking.  Fortunately we decided no, as the highway is yet to be built.

Diazo wrote:

But I imagine for the average expat and their age [50 years] would not be much of a factor.

Very true.  If you are buying for the future of your Vietnamese spouse and/or children then the limitation is not a factor, as they are citizens.  If you are buying only for yourself then you are either speculating for appreciation or rent seeking, neither of which is really a good in the eyes of a Communist government.  It is therefore natural that the government would not be working to make things easier for you.

Not Freudian typo. Simply a person that never has been one to QC what they type ,compounded by a spell checker that does not accommodate big clumsy fingers on a small keyboard. And the inventor of the qwerty keyboard should have never put an ”i” next to an ”o” with spell checker on the horizon!!!😀

Hi,

Just bought an apartment in Hanoi and thinking of investing in HCMC as well.

For the experienced folks living in Vietnam, would appreciate your thoughts on District 2 vs 4 in HCMC and Hanoi vs HCMC in terms of long term appreciation.

What I can gather from my research is that whilst District 2 seems to be where the crowds are, District 4 may be more valuable longer term due to its closer proximity to District 1 and lack of any further development land?

Similarly, HCMC is the popular city but is the price there already too high and Hanoi may be a better investment?

Thanks!

Hi

Nobody knows what will really happe after 50 years...

Anyway, you just sell before 50 years...

District2 very nice and calm.
I bought 2 appartments in D2, New City for me and Diamond Island to rent at about 1400 $.

Curious the one you will rent for $1,400, how much did you have to pay for it?

I would never buy an apartment in a high-rise building in Vietnam or rent it for prices like $1400.

I am now temporarily living in a tower building in the Binh Chanh/D8 area.
The tower building is about 6 years old, but looks like a 20-year-old tower building in the western world.
Rentals are about $250 for 80m2 (3 bedroom, 2 bathrooms). The owners of these apartments were certainly been predicted higher rentals.

There are dogs barking on the balconies in probably every second apartment.
Many people leave the front doors open (probably to save electricity for the air condition) so that you can hear the noise of children, dogs, TV, telephone calls, music, karaoke and you can smell the cooked food from the whole floor and cigarette smoke in your apartment.
I think not anybody would pay 1000$ or more for such apartments.

Perhaps the predicted rents to be achieved for the first year are correct. But after a few years at the latest I think you will only get a fraction of that.

Even if you only consider how many new tower building complexes are currently being built in D2 and D7, I would be worried.

My friend bought two apartments in Vinhomes Central Park. She was told to expect a monthly rental of 1300 usd, I went to view it, and informed her she would get around 850-900 usd. After a year being vacant, she finally got 850 usd. These builders should be held accountable for the crap they spew out.

I think I have said before basically what Andy has experienced. These places look nice when new. But Vietnamese loath walls that are clean and fresh paint. Not sure why they need to put their hands all over the walls in the common areas. I had painted, at my exspenses the walls in the halls in my floor once a year. And forget about peace and quite, smoke, and the smell of food cooking. It is endless.
Nevertheless it would be interesting to know how much Deflon paid for the condo that is going to rent for $1,400 in 2018.
Not sure if there are any shared cost by all tenants in these high rise buildings. And if so what they are. Would be nice if they had HOA ( home owners association) fees that all paid. But then these crooks would probably take the money and do no repairs.

Vagabondone wrote:

I think I have said before basically what Andy has experienced. These places look nice when new. But Vietnamese loath walls that are clean and fresh paint. Not sure why they need to put their hands all over the walls in the common areas. I had painted, at my exspenses the walls in the halls in my floor once a year. And forget about peace and quite, smoke, and the smell of food cooking. It is endless.
Nevertheless it would be interesting to know how much Deflon paid for the condo that is going to rent for $1,400 in 2018.
Not sure if there are any shared cost by all tenants in these high rise buildings. And if so what they are. Would be nice if they had HOA ( home owners association) fees that all paid. But then these crooks would probably take the money and do no repairs.

A manager from Petro Land was doing just that.

Having worked in construction for 25 years I am appalled at what Vietnamese accept as a finished product. Most builders here would be deregistered in my home country.

Vagabondone wrote:

Not sure if there are any shared cost by all tenants in these high rise buildings. And if so what they are. Would be nice if they had HOA ( home owners association) fees that all paid. But then these crooks would probably take the money and do no repairs.

We were close to buying a house (serial house not tower apartment) in a new construction project in Binh Chanh.
The maintenance fee was 1% of the sales value (onetime fee).
In this case, that was about 31 million dong.

Then there were monthly service fees (water and electricity not included) of 7000 Dong per m2.
In this case, that was about 1 million Dong per month.

Andy Passenger wrote:

Vagabondone wrote:

Not sure if there are any shared cost by all tenants in these high rise buildings. And if so what they are. Would be nice if they had HOA ( home owners association) fees that all paid. But then these crooks would probably take the money and do no repairs.

We were close to buying a house (serial house not tower apartment) in a new construction project in Binh Chanh.
The maintenance fee was 1% of the sales value (onetime fee).
In this case, that was about 31 million dong.

Then there were monthly service fees (water and electricity not included) of 7000 Dong per m2.
In this case, that was about 1 million Dong per month.

Buy your own freestanding house, not in a development, and avoid those stupid costs that are just lining someone's pockets.

Yeah if you could, but you can't. Maybe someday. But those cost do have value is used properly. It will better protect your property. I General I am against HOA's. But I can see where they could be of benefit here. If you could find one honest person when it comes to money.

Vagabondone wrote:

Yeah if you could, but you can't. Maybe someday. But those cost do have value is used properly. It will better protect your property. I General I am against HOA's. But I can see where they could be of benefit here. If you could find one honest person when it comes to money.

Just in your name, you can't at present. But you can do it with your wife or partner if you trust them enough.