LAND HIKE SHOCK DEEMED NECESSARY

An adjusted land price list in Ho Chi Minh City is set to bring higher compensation for around 80,000 households whose land will be recovered for various projects, but it is also expected to drive up real estate prices.

On August 28, Nguyen Toan Thang, director of Ho Chi Minh City Department of Natural Resources and Environment, confirmed that according to the draft, land prices in many areas of the city are expected to increase by up to 50 times.

The new land price list is expected to be implemented from the beginning of October to the end of the year. After that, the list will be reviewed again, to be applied for 2025. After that, the list will be adjusted every year under the force of the revised Land Law 2024.

However, Thang noted that these prices would still only reflect about 70 per cent of the market value.

“The new land valuation will help prevent real estate brokers from purchasing land at low prices and then inflating them to make large profits. This will protect home buyers’ rights and create a more transparent market, driving sustainable development in the real estate sector,” Thang said.

Le Thi Binh, a resident of Cu Chi district on the outskirts of Ho Chi Minh City, expressed concern that the draft price list will increase land prices by an average of 5-10 fold. In some suburban and peripheral areas, prices are expected to rise by as much as 50 times, creating significant pressure on those with agricultural land.

“I own more than five hectares of long-term cropland in Cu Chi district. If the new land price list is applied, I will have to spend billions to transfer it to residential land,” Binh said.

Similarly concerned, Nguyen Minh in Binh Chanh district said he is currently in the process of transferring his land to residential use.

“I haven’t yet calculated the total taxes and fees I’ll have to pay under the new price, but I’m afraid it will be too much, and I won’t be able to handle it,” Minh said.

Nguyen Minh Hoa from Go Vap district is also anxious as she plans to buy an apartment for VND4 billion ($166,000) after years of saving and borrowing from the bank. However, the seller has decided to halt the sale, anticipating that the apartment price will rise significantly if the new land price list is applied.

“Finding an apartment for our three-generational family has been difficult enough. Now, our dream of owning a home feels even further away, and we don’t know when we will be able to achieve it,” she said.

According to lawyer Le Thu Thao from the Ho Chi Minh City Bar Association, the adjustment of the land price list is not only a significant policy change but also reflects the government’s effort to create a more sustainable investment and development environment.

“Despite differing opinions and objections from the community, it is crucial that the implementation of this policy is carried out transparently and with adequate preparation to ensure the rights and stability of all parties involved,” Thao said.

She emphasised that implementing a major policy like the new land price list, which has such a profound impact on people, must be carried out with clear communication to avoid unnecessary confusion.

“The authorities need to study the land price increases with a clear roadmap, divided into multiple stages, to reduce the shock for businesses and residents, especially in outskirts districts where land conversion procedures are more volatile, and livelihoods remain challenging,” Thao said.

Ho Chi Minh City People’s Committee is currently considering issuing the new land price list in accordance with the provisions of the 2024 Land Law. The land price list has undergone drafting, public consultation, and review conferences. Once all opinions have been considered and revisions made, it will be submitted to the committee for approval.

Source: VIR