New regulations to remove bottlenecks for OV real estate investment

The laws provide a uniform approach to issues related to land, housing and real estate, ensuring the rights of OVs with the Vietnamese nationality to own and trade real property like Vietnamese citizens residing inside the country, evidencing the country’s policy of taking OVs as an inseparable part of the nation.

Under the newly-adopted Land Law, Vietnamese citizens residing abroad can enjoy full rights related to land, not only those to residential land, like their fellow residents inside the country.

They are allowed to build houses and invest in construction projects for sale, lease, lease purchase, and invest in technical infrastructure in real estate projects to transfer, lease, and sublease the right to use land with technical infrastructure.

Currently, OVs are allowed to own houses in Vietnam, but can only receive transfer of residential land use rights through purchase, lease purchase, inheritance, and donation of housing attached to land use rights, or only receive residential land use rights in housing development projects.

The regulations have prevented them from transferring, donating, and inheriting land outside housing development projects, and from enjoying the right to build and own houses on land outside housing development projects.

Lawyer Nguyen Van Hau, Vice Chairman of the Ho Chi Minh Bar Association, said that with the new regulations, it will be easier for OVs to own real estate in the country.

He elaborated that previously, although regulations allowed OVs to buy real estate in Vietnam, many had to authorise their relatives to be the owner of the property. Because of concerns about complicated procedures and regulations, many overseas Vietnamese hesitated to buy real estate in the country, he added.

This amendment has created equality between domestic individuals and OVs in terms of investing and undertaking ventures in the real estate business. When buying a house and having the rights like domestic citizens, they will transfer remittances to invest and buy a house in Vietnam. Thus, the real estate market will see great demand from OV individuals for high-end housing in the market now, Hai stated.

Last year, more than 19 billion USD in remittances flowed into Vietnam, a similar figure to 2022. It is forecast that in 2024, remittances will increase by about 20% compared to 2023.

Since 2012, the amount of remittances sent to Vietnam has reached over 10 billion USD per year, of which about a quarter is poured into real estate.

Mai Hai, a real estate broker, said that the populous market and high profits are considered attractive for remittance to pour into Vietnamese real estate.

He noted that the rate of OVs buying houses in Vietnam is increasing, adding that Vietnam’s rental profit is also quite attractive at 5-7%, higher than developed markets like Australia or the US.

According to the Business Association of Overseas Vietnamese, in the future, the amount of remittances will be abundant because the Vietnamese community abroad is increasing in both quantity and living areas.

The number of Vietnamese people living abroad, which was about 2.7 million in 2004, has now tripled to about 7 million in 109 countries and territories around the world.

About 80% of overseas Vietnamese live and work in developed countries such as the US, Australia, Canada, and France, and more than half a million work through labour export programmes, or study abroad./.