Expanded land use rights expected to attract OV investment in real estate

Expanded land use rights expected to attract OV investment in real estate, Illustrative image (Photo: baodautu.vn)

HCM City - The expansion of land use rights for overseas Vietnamese (OV) in the recently passed 2024 Land Law is good news for OVs who want to own real estate in Vietnam, said experts from Savills Vietnam.

This is even more meaningful considering the strong remittance flow to Vietnam in 2023, which exceeded 16 billion USD, up 32% annually, they said.

The 2024 Land Law, taking effect on January 1, 2025, introduces significant changes for OV land users. They will be entitled to almost all the land use rights previously reserved for Vietnamese citizens. Additionally, foreign-invested economic entities and people of Vietnamese origin abroad will benefit from the expanded rights, including receiving transferred land use rights and re-renting land use rights at industrial and hi-tech parks.

This change will bring more investment opportunities for the OV homebuyer group, said Deputy Managing Director of Savills Vietnam Troy Griffiths.

According to the Savills Vietnam experts, in the past, OVs wanting to invest in property in Vietnam had to do so via family members or relatives, resulting in disputes. The new Land Law has solved this problem, facilitating investment and minimising risks for OV investors.

Statistics provided by the State Committee for Overseas Vietnamese Affairs revealed a substantial flow of remittances into Vietnam. From 1993, the first year remittance data was collected, to the end of 2022, the total amount of remittances surpassed 190 billion USD, almost equal to the FDI sum disbursed in the same period.

A significant portion of remittances, primarily from Asian countries through workers, has already been directed towards real estate sector, according to Griffiths.

Fixing land use rights for foreigners Adding the provision that foreign individuals would be allowed to use residential land in Vietnam to the revised Law on Land could ensure uniformity and better consistency in the country’s current legal system.

Land use rights for condotels remain stalled amid lack of thorough guidance Three months after a decree was issued to regulate land and housing rights certificates for condotels, additional guidance for relevant departments is still not forthcoming.