A lot of customers ask about 50 years of land use, I would like to share my perspective on this issue.
Land use term of 50 years is a very important concept in real estate and there are many controversies and views on this issue. Currently the shelf life of 50 years applies to the following cases:
– Officetel,
– Condotel
– Shophouse, commercial land services
– Agricultural land, perennial trees, forest land, aquaculture land.
– Industrial and production land.
– Houses owned by foreigners.
Due to many types, I only own Officitel apartments and apartments owned by foreigners.
How does the 50-year ownership period affect the current and future prices of real estate? Many investors feel uncomfortable about this deadline, but not yet fully aware of its impact. There are actually many ways to look at this.
Currently, officetel house prices are always 10-20% lower than the price of long-term apartments in the same building, although more functional (used for office, business registration …) because home buyers are not sure if after 50 years will be extended or not. The apartments at Landmark 81 building, once promised by Vinhomes to be owned for long term, were not allowed by the government later, so they were converted into 50-year ownership, at which time Vinhomes had to repay some money to Owner.
In contrast, in the same apartment building, due to the percentage sold to the NNN only 30% of the number of units, the selling price to foreigners (owned for 50 years) is always 20-30% more expensive than the apartments for Vietnamese (departmental units). long-term friendship). So, those green eyes with wild nose or why are you buying so expensive? The answer here is probably related to the law of supply and demand, NNN wants to buy houses in Vietnam, there is no other way so they have to accept such high prices. In addition, NNN, they also think that after 50 years we have already moved to another world, what can we do if we think far away. Vietnamese people living longer than NNN should be more worried about 50 years? Not so, but Vietnamese people like to wear clothes, they will leave the house to the next generation.
Foreigners buying houses in Vietnam may own the following forms:
+ Red book of time can be sold to eligible NNN in the name of Vietnam. Or if sold to Vietnamese people will become permanent.
+ Long-term lease contract: if transferred to NVN, it will be transferred to a sales contract or issue a pink book of NVN name.
There are two perspectives on this 50-year period:
1. Many people think that after 50 years will be expired, no risk should still buy and sell as usual. In principle, if there is no plan, no new policy will still be extended, but 50 years is a very long way, everything can change. What if you buy a property worth several billion, even a few tens of billion, if the state does not renew it for you? Under the current law, the land use levy will be extended and the property on the land will not be lost.
2. For those who are more cautious, because there are a lot of uncertainties in the future, they should assume that after 50 years they cannot be extended, the value of that asset will be depreciated in 50 years. For example, a shophouse costs 10 billion, so each year the value of that property decreases by 200 million (10 billion / 50 years). After 50 years, if your assets are due, it will be an extraordinary benefit, but if not, you will not be shocked because of psychological preparation.
Investment is always risky, investors should consider carefully, learn all aspects thoroughly before making their final decision.