Owning residential property in Vietnam is becoming increasingly attractive to foreigners, both for investment and long-term settlement. However, transactions involving foreign individuals or organizations are subject to specific legal requirements regarding eligible entities, transaction forms, registration procedures, and financial obligations.
The following article, compiled by DNP Viet Nam Law Firm, provides essential legal information on the entire process of conducting residential property transactions, helping foreign investors and individuals act proactively and minimize legal risks during contract negotiation and implementation.
1. Conditions for the parties involved in the transaction
Legal basis: Article 161, Law on Housing 2023.
For the transferor (seller, lessor, donor, etc.):
- Must be the lawful owner of the property, possess full civil act capacity, and meet the legal conditions applicable to the entity as prescribed in the Civil Code.
For the transferee (buyer, lessee, donee, etc.):
- Foreign individuals or overseas Vietnamese: May participate in housing transactions only if they belong to the group of entities eligible to own residential property in Vietnam under the Law on Housing. Residence registration in the locality is not required.
- Foreign organizations: Must have legal person status and fall within the category permitted to own residential property in Vietnam. In cases where they are authorized to manage housing, they must have business functions in real estate.
2. Procedures for conducting housing transactions
Legal basis: Articles 162, 163, and 164, Law on Housing 2023.
Step 1. Drafting the housing contract
- All housing transactions must be made in writing and include all required contents under Article 163.
- A housing contract only takes effect upon notarization or authentication, except for the following specific cases:
- Donation of gratitude houses, charity houses, or solidarity houses;
- Transactions involving public housing;
- Transactions where one party is an organization (e.g., social housing, housing for the armed forces, resettlement housing);
- Capital contribution using housing with an organization;
- Transactions of lease, loan, stay, or authorization for housing management.
Step 2. Notarization or authentication and the time of contract effectiveness
Effective date:
- For transfer of ownership or land use rights, the contract becomes effective upon notarization.
- For contracts not subject to mandatory notarization, effectiveness is determined by the parties’ agreement or the signing date.
Place of implementation:
- Notarization is conducted at a notary public office;
- Authentication is performed at the commune-level people’s committee where the property is located.
Note: Once real estate trading platforms are fully operational nationwide, notarization may no longer be mandatory in certain cases, as such platforms will ensure transaction transparency and record-keeping.
Step 3. Filing for the certificate of ownership
- The parties may agree that one of them, usually the buyer or project developer, will submit the application to the land registration office for the issuance of the certificate of ownership of housing and land use rights.
- For developer-led housing projects, the developer is responsible for carrying out the certificate application on behalf of purchasers.
Step 4. Fulfilling financial obligations
- The buyer or transferee must pay all applicable financial obligations, including registration fees, personal income tax, and value-added tax (if applicable), as prescribed by the tax laws.
Step 5. Receiving the certificate of ownership
- Upon completion of all financial obligations and verification by the competent authority, the transferee will be granted the certificate of ownership of housing as the lawful owner.
“The above content is provided by DNP Viet Nam Law Firm for reference purposes only. For detailed, accurate, and tailored legal advice that meets your specific needs, please contact us using the information provided below.”
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