Brian Jeffrey
New Land Rental Rates in Ho Chi Minh City
Recently, Ho Chi Minh City has seen a notable rise in rental prices due to an increase in adjusted land values, despite a cut in the calculation percentage for annual land rental fees.
Regulations issued by the local government became effective on January 20, establishing new guidelines for determining annual rental fees for various types of land leases that were not auctioned.
These guidelines categorize land based on its intended use, including agriculture, high-tech zones, industrial areas, and commercial services.
Rental Rates by Land Use
The annual rental fees are calculated as a percentage of the land price and vary by type of land:
- Agricultural land, including high-tech agricultural zones: 0.25%.
- High-tech zones, including Quang Trung Software Park, export processing zones, industrial zones, and clusters: 0.5%.
- Non-agricultural business land:
- Zone 1 (Districts 1, 3, 4, 5, 10, Phu Nhuan): 1%.
- Zone 2 (Thu Duc City and Districts 6, 7, 8, 11, 12, Binh Thanh, Binh Tan, Tan Binh, Tan Phu, Go Vap): 0.75%.
- Zone 3 (Hoc Mon, Cu Chi, Binh Chanh, Can Gio, Nha Be): 0.5%.
- Commercial and service land:
- Zone 1: 1.5%.
- Zone 2: 1%.
- Zone 3: 0.75%.
Impact on Rental Costs
Even with the reduced percentage rates for land rentals compared to the past, the recent adjustments to the city’s land price framework have led to substantial increases in rental fees.
Specifically, rates for non-agricultural business land are anticipated to go up by 35% to 54%, while those for commercial and service land are expected to rise by 18% to 23%. In contrast, agricultural land rental costs are predicted to decrease by 22%.
These developments underscore the evolving landscape of Ho Chi Minh City’s real estate market, where increasing land values are closely linked to rising rental prices.
