Brian Jeffrey
The Director of the HCM City Department of Natural Resources and the Environment, Nguyen Toan Thang, mentioned during discussions on the city’s socio-economic development that adjustments to the existing land price framework will be made under the amended 2024 Land Law. It is stated that the provincial people’s committee holds the authority to review, utilize, and modify old land price frameworks.
Therefore, rather than constructing a new framework, HCM City intends to revise the current land price framework.
The adjustment process involves seven steps in principle, with six steps already completed. The data gathered by consultancy units has been authenticated and handed over to the working group of the HCM City People’s Council for review.
Thang remarked, “This is solely an amended version, as the new land price framework will be established and implemented starting from January 1, 2026.”
He further added, “The department is revising and refreshing land prices based on market transactions, cross-checking approved compensation prices and market values to prevent losses in case the existing price levels become outdated.”
Some areas in HCM City have fixed prices as low as VND1-2 million per sq m, whereas actual market prices range between VND100-200 million during transactions. Hence, adjustments are necessary to align land price levels with current market values.
In July, the number of land-related documents in HCM City saw a rise, with 40,000 dossiers, primarily linked to property transactions like purchases, sales, and mortgage agreements. The city accumulated tax revenues worth VND12 trillion from land-related sources in the past seven months.
The HCM City Department of Natural Resources and the Environment is in the final stages of completing the necessary procedures to present a land price framework for the city to the People’s Committee, complying with the 2024 Land Law.
Regarding the drafted decision on adjusting the 2020 land prices by HCM City Department of Natural Resources and the HCM City Real Estate Association (Horea), a proposal to postpone the adjustment and enforcement, originally planned for August 1, has been put forward.
Horea suggests that the focus should be on establishing a land price framework for implementation starting January 1, 2026, as per Article 257 of the 2024 Land Law, which states that land prices set according to the previous land law will remain applicable until December 31, 2025.
Horea’s chair, Le Hoang Chau, emphasized the importance of understanding why withholding adjustments in land prices at this juncture would be more beneficial by empathizing with the people’s perspectives.
For example, Mr. A. in Binh Hung commune of Binh Chanh district applied for a land use right certificate for a property located on a 100 sq m land plot alongside Nguyen Van Linh Road. Originally designated as agricultural land, the plot was priced at VND6.8 million per sq m based on the 2020 land price framework.
Switching to current prices would escalate A’s payment to VND660 million. However, under adjusted land prices, the amount due would reach VND6.18 billion.
Similarly, Mrs. B owns a 200 sqm plot on Nguyen Van Linh Road in Binh Hung commune of Binh Chanh district. Initially, due to financial constraints, B obtained a land use right certificate for a 100 sq m area where a house was constructed, leaving the remaining 100 sq m for short-term agriculture.
Looking to convert the residual 100 sq m into residential land, Mrs. B would face land use fees of VND6.18 billion if new land prices are applied, contrasting with VND660 million under the existing price framework.
Chau remarked, “I believe that these households would prefer the current land price structure over adjusted prices if given the option for tax calculations. Currently, there seems to be no urgent need for land price adjustments.”
Sources revealed to VietNamNet that the drafted decision on 2020 land price adjustments is pending verification and approval by the HCM City Land Price Appraisal Council.
