How to Purchase Realty in Vietnam

Step 1. Reserving the property

When you buy real estate in Vietnam, security regulations are not much different from other countries. In the primary market you should ask whether the developer has a construction license, permission to build a building in this particular location and approval of the development plan from the local authorities. 

When purchasing properties under construction or ready-made housing directly from the developer, please check the following documents: 

• company registration certificate
• permission for construction 1/500
• document certifying the developer's right to land 
• approval of the investor as a developer 
• investment activity permit

If you purchase a property on the secondary market, you need to make sure that the documents for the purchased housing are legally clean. You should contact a lawyer to comply with all the formalities.

The following parameters must be checked:

• The ownership, purity of the title: check the documents confirming the seller's legitimacy to own and dispose of the property, in particular, the construction permit.
• The bankruptcy status: check that the property owner is not bankrupt.
• The right to buy: make sure there are no restrictions on the purchase of this type of housing.
• Debts of the previous owner (utilities, management company).

When the title is checked and there are no encumbrances, it is necessary to sign an agreement on the reservation of the property, under which the parties will be obliged to adhere to the agreement on the transaction. Usually, you have to transfer the deposit to the seller in the size of VND 100 miln (approx. $4,300). It is a guarantee of the buyer's serious intentions. In case of your refusal to purchase, money will remain with the seller as compensation. Property can be reserved for up to 15 days. We recommend checking the agreement with a lawyer.

The agreement is signed at the developer's office or in the agency, if it is a question of purchasing a secondary real estate object. The deposit must be paid in cash or by a bank transfer.

Step 2. Preparing the sale contract

Both the seller and the buyer must provide following documents in Vietnam: 

• the identity document
• the marriage/divorce certificate or document confirming that the seller/buyer is not married 
• the certificate of ownership of residential real estate 
• the certificate of land use

With this package of documents, you must appear at a notary, who will notarize all the documents provided and issue four copies of the contract of sale: one copy for the seller, the second for the buyer, the third for the tax service, and the fourth for the real estate registration agency. 

At the time of entering into the agreement, make sure that the agreement is signed by all related parties or their authorized representatives. The contract for the purchase and sale must be written in Vietnamese, so you will need a Vietnamese translator to read details.

Although many vendors provide a bilingual version of the contract for better understanding by all involved parties, according to Vietnamese law only the Vietnamese version of the document is valid.

Here are the details you need to pay attention to when signing:

• Make sure that the certificate of ownership belongs to the seller, and that he gives a guarantee for this property.
• Examine the seller's obligations in the event of a dispute over the ownership of an apartment due to their fault
• Payment method
• Taxes and fees
• Period of transfer of ownership

After that you must submit an application for changes to the legal use of the land plot in one copy within 10 days, as well as a tax return for subsequent tax payment to the Agency of natural resources and environment. Otherwise, if you violate the deadline for submitting documents, you will have to pay a fine.

Hanoi, Vietnam

Step 3. Making a payment

Providing documents about the origin of money is not necessary. However, the following conditions must be met:

1. The payment must be made through a licensed credit institution in Vietnam (for example, a bank). Sending money to Vietnam is relatively easy, although the transfer must be properly documented to avoid possible problems later.
2. In the secondary realty market the payment must be made in full. But in the primary market it can be made in several steps. There are different payment schemes to choose from, but usually the first payment (at the early stage of building) is about 20-30%, the remaining amount is paid in stages as construction progresses, and the last 5% is paid after obtaining ownership.
3. Withdrawing money from Vietnam is still a problem for foreign property owners. It is believed that the foreigner must have documents confirming the source of income, such as: proof of income in Vietnam, confirmation of domestic money transfers to Vietnam, the purchase and sale agreement, and so on.
4. Usually, the buyer pays the registration fee and the seller pays income tax, unless both agreed on different terms. The payment is made at the tax office of the district, where the property is located.

Step 4. Registering ownership rights

You can receive the certificate of ownership independently. The approximate registration of a certificate of ownership is from 4 to 12 months.

The certificate of ownership of real estate is a certificate for the right to use an apartment/house/land. To obtain this certificate of ownership you must provide the following documents:

• an application for a certificate in Vietnamese and English according to the established model, 
• documents confirming the seller's ownership of the property,
• a construction permit from the local authorities, if you are purchasing an apartment in a building with the status of "residential commercial project", 
• land lease agreement or land transfer order, if the villa is being purchased, 
• a statement of transfer of the property, 
• relevant documents as prescribed in the case of donation or transfer of the apartment by inheritance,
• the original contract of sale, gift or will, 
• a notarized copy of your passport,
• a receipt for payment of tax and state duty in accordance with the law.

Step 5. Updating right of ownership

For a foreigner, who owns residential real estate in Vietnam, the procedure for extending the term of ownership of real estate is as follows: 

1. 3 months before the expiration of the term of ownership of the property, if the owner wants to extend this period, they must submit an application for an extension, which specifies the extension period. The application must be accompanied by a notarized copy of the ownership rights. These documents must be sent to the People's Committee of the province, where the property is located;
2. Within 30 days of receiving the owner's application, the People's Committee of the province reviews it and issues a written authorization for one extension of the period of ownership of the property at the request of the owner. This extension must not exceed 50 years from the date of expiration of the ownership term specified in the certificate.
3. According to the written permission of the People's Committee of the province, the authority that issued the certificate, issues an extension to the certificate and sends a copy of the certificate to the Construction Department of the same province for statistics.

Pictures: pixabay.com 

Quoting conditions of Prian.info materials