Along with the continuous development of society, the need to live, work and settle down, accompanied by the need to own real estate of foreigners in Vietnam is becoming more and more popular.   Accordingly, Vietnamese law has developed governing principles and regulations to ensure that the real estate ownership of foreigners in Vietnam is in accordance with the actual situation of society and the management of the country.  In particular, there are limitations on real estate ownership that foreigners need to understand and properly implement to ensure that their real estate ownership in Vietnam is in accordance with the law, and at the same time protect their legal rights.  The content of this legal insight will delve into the analysis of legal provisions on the limitation on real estate ownership, specifically home ownership and land use rights of foreigners in Vietnam.

Limitations on land use rights of foreigners in Vietnam 

According to the provisions of Article 5 of the 2013 Land Law, foreigners are not allowed to recognize land use rights as individuals in Vietnam.

Limitations on housing ownership of foreigners in Vietnam 

Article 159 of the 2014 Law on Housing (Law on Housing) stipulates that foreign individuals who are entitled to own houses in Vietnam include (1) Foreign individuals investing in project-based housing construction in Vietnam; and (2) Foreign individuals allowed to enter Vietnam.  Foreign individuals may own houses in Vietnam through the following forms: 

1. Invest in project-based housing construction in Vietnam; 
2. Buy, rent and purchase, receive as a gift, or inherit commercial housing including apartments and separate houses in the project for housing construction, except for areas under management relating to national defense and security as prescribed in regulations of the Government. 

Accordingly, foreign individuals who are entitled to own houses in Vietnam must satisfy the conditions for home ownership in Vietnam as prescribed in Article 160 of the Law on Housing, guided by Article 74 of Decree 99/2015/ND-CP, and have rights and obligations as prescribed in Article 161 (guided by Article 76,  Article 77 of Decree 99/2015/ND-CP, amended by Clause 23 and Clause 24 Article 1 of Decree 30/2021/ND-CP) and Article 162 of the Law on Housing.  Specifically: 

• Conditions for home ownership in Vietnam: 

• • Foreign individuals investing in project-based housing construction in Vietnam: Must have an investment certificate and have housing built in the project in accordance with the law.

• • Foreign individuals allowed to enter Vietnam: Must have permission to enter Vietnam and he/she has not been granted diplomatic immunity and privileges as prescribed. (Document proving eligibility for owning houses in Vietnam is an unexpired passport bearing the entry seal of the Vietnam’s immigration authority and not given diplomatic immunity and privileges according to the Ordinance on diplomatic immunity and privileges of diplomatic missions, consular offices, and representative authorities of international organizations in Vietnam.) 

• Rights of housing owners who are foreign individuals: 

• Foreign individuals investing in project-based housing construction in Vietnam: To exercise the rights of housing owners as prescribed in Article 10 of the Law on Housing.  

          If the house is built on a piece of leased land, he/she is only entitled to lease that house. 

• Foreign individuals allowed to enter Vietnam:  To exercise the rights of homeowners similar to Vietnam citizens provided that he/she complies with following regulations: 

• Only purchased, rented and purchased, received as a gift, inherited and owned no more than 30% of the number of apartments in an apartment building; if it is an individual dwelling house consisting of villas and townhouses, on an area with a population equivalent to a ward-level administrative unit, no more than two hundred and fifty houses may be purchased, rented and purchased, received as a gift, inherited and owned. (refer to the guidance in Article 76 of Decree 99/2015/ND-CP, amended by Clause 23 Article 1 of Decree 30/2021/ND-CP). 

• In case of being received as a gift or inherited housing that does not fall under the provisions of Point b, Clause 2, Article 159 of the Law on Housing (receive, or inherit commercial housing including apartments and separate houses in the project for housing construction) or exceeding the maximum number of houses owned, the foreigner shall only be entitled to the value. 

• Foreign individuals are eligible for homeownership as agreed in agreements on housing sale, leases, purchases, gifting, or inheritance for not more than 50 years, from the day on which they are granted a Certificate and they may be also granted extension as prescribed in the regulations of the Government; the duration of the homeownership must be stated in the Certificate. 

• If a foreign individual marries to a Vietnamese citizen or an overseas Vietnamese, he/she qualifies for stable and long-term homeownership and has all the rights of a homeowner similar to Vietnamese citizens. (refer to the guidance in Article 76 of Decree 99/2015/ND-CP, amended by Clause 23 Article 1 of Decree 30/2021/ND-CP). 

• Before the time limit of the homeownership prescribed in the Law on Housing expires, the homeowner is entitled to gift or sell their house(s) to entities eligible for homeownership in Vietnam; if not, their house(s) shall be placed under the ownership of the State. 

For cases in which ownership of houses in Vietnam is not recognized, Article 78 of Decree 99/2015/ND-CP specifies that foreign individuals in the following cases shall not be granted Certificates for housing and may only sell or offer it to another entity eligible to own housing in Vietnam:  

• Foreign individuals who receive a house as an inheritance or a gift that is located in an area in which foreign individuals must not own houses, or the quantity of which exceeds the permissible limits: This person may directly sell or offer the houses or authorize other persons to do so. 

• Foreign individuals who are not permitted to enter Vietnam, receives a house in Vietnam as a gift or an inheritance: This person may authorize other organizations and individuals residing or operating in Vietnam to sell or offer the houses. 

The order and procedures for selling, offering houses of the above-mentioned subjects shall comply with the provisions of the Law on Housing and relevant guiding documents. 

Above are the relevant contents on the limitation of real estate ownership, specifically land use rights and home ownership rights of foreigners in Vietnam.  To ensure a correct, sufficient understanding and exercise of rights and obligations in accordance with the law, don’t forget to follow and update more useful information on our website. Please contact us for more detailed instructions: info@letranlaw.com