On the morning of November 28, the National Assembly officially pressed the button to pass the Law on Real Estate Business (amended). Accordingly, the Real Estate Business Law 2023 has many outstanding new features compared to the Real Estate Business Law 2014. Join Pham Consult to learn about the new features of this Law!
- Narrow the scope of adjustment
The 2023 Real Estate Business Law does not apply to agencies and organizations selling houses, construction works, transferring land use rights due to bankruptcy, dissolution, division, separation…; Credit institutions, debt management companies… sell houses, construction projects, transfer land use rights, transfer real estate projects as collateral to recover debt…
The transfer of land use rights and transfer of real estate projects as collateral for debt recovery shall comply with the Law on Credit Institutions currently being amended, and the Law on Real Estate Business shall not apply.
- Consistent use of the term “foreign-invested economic organization”
The Real Estate Business Law 2023 has removed the term “foreign-invested enterprise” according to the Real Estate Business Law 2014; Uniformly use the term “foreign-invested economic organization”.
This helps synchronize with the Investment Law 2020 and the Draft Land Law (amended): Economic organizations carry out investment procedures like domestic investors (foreign capital <50%) with the right to do real estate business. Real estate such as domestic organizations; Only economic organizations with >50% foreign capital must follow the same procedures as economic organizations with foreign investment, meaning there are some restrictions on real estate business compared to domestic investors. .
- Responsibility for submitting application documents for certification to customers of real estate project investors
Within 50 days from the date of handing over the house to the buyer or from the time the lessee has paid in full, the application must be submitted to the state agency to issue a Certificate to the buyer or the buyer. rent purchase…
This regulation matches Article 39 of the recently passed Housing Law 2023, both are within 50 days. However, it will put pressure on project investors to carry out procedures to issue Books to customers, leading to fragmented procedures for large projects with many products. In fact, investors often gather many documents to submit each application for a Book in batches, so it is difficult to ensure the 50-day deadline.
- Use real estate business model contracts
Real estate project investors and real estate businesses use model contracts issued by the Government. The model contract only includes main contents, other contents as agreed by the parties.
Thus, we respect the agreement of the parties and end the debate on whether to force or choose to apply the model contract according to Decree 02/2022/ND-CP.
- Deposit issues in housing business and construction projects formed in the future
The Law on Real Estate Business 2023 stipulates that project investors can only collect deposits of no more than 5% of the selling price or lease purchase price of houses and construction works from customers when the houses and construction works have been completed. has all the conditions for putting it into business according to regulations. The deposit agreement must clearly state the selling price, lease-purchase price of the house or construction project.
- Tighten conditions for commercial housing and construction projects to be formed in the future
Firstly, project investors are required to fulfill financial obligations regarding land for land use rights associated with housing and construction works put into business.
The 2014 Real Estate Business Law does not have this regulation. However, some localities still require investors to fulfill financial obligations before selling products.
Second, housing and construction works must be part of a real estate project that has been approved by a state agency in accordance with the law. The approved project content must have the purpose of investing in housing construction. Construction works for sale, lease purchase.
- Payment in buying, selling, renting and purchasing houses and construction works formed in the future
If the buyer or lessor has not been granted a certificate, the seller or lessor cannot collect >95% of the contract value; The remaining value is paid when the certificate is issued to the buyer or hire-purchaser.
Remain the same as the Real Estate Business Law 2014; The customer is allowed to retain 5% of the contract value while waiting for the certificate to be issued (the option allowing the investor to collect the remaining 5% in advance into a blocked account was not approved).
- Regulations on guarantees for selling and leasing houses formed in the future are stricter
Before selling or leasing future housing, the project investor must obtain bank approval to issue a guarantee for the investor’s financial obligations to the housing buyer or lease-purchase party when the investor do not hand over the house as committed.
When signing a sale or lease purchase contract, customers are allowed to choose whether or not to have a guarantee for the investor’s financial obligations to them.
This new regulation not only strictly ensures and avoids “ghost projects” from investors, but also allows flexibility for parties to negotiate and customers to choose and decide whether or not to have a guarantee for their financial obligations. investors for themselves.
- Conditions for dividing plots and selling plots are stricter than current regulations
Conditions for land transferred to individuals to build their own houses (subdivide plots, sell plots) as agreed with the Housing Law: Not belonging to wards, districts, cities of special class, class I, II urban areas ,III; Not subject to auction of land use rights. The remaining areas are up to the Provincial People’s Committee to decide on the areas to be divided into plots for sale.
In addition, before transferring land use rights, the project investor must send a written notice to the Department of Construction; Within 15 days, the Department of Construction checks the conditions of land use rights put into business and responds in writing about eligibility/insufficiency for certification.
- Tighten conditions for transferring all/part of real estate projects
Conditions for transferring all/part of a real estate project: The transferring investor must complete financial obligations regarding land of the project including land use fees, land rent and taxes, fees and charges. Fees related to the project’s land and project transfer portion.
Thus, the new law tightens the conditions for transferring real estate projects, stipulating that the transferor must fulfill its financial obligations to the State; It is not recorded that the parties agreed to let the transferee continue to fulfill its financial obligations as recommended by many experts.
- Land procedures if the real estate project transferee is an economic organization with foreign investment
In case the transferee of all or part of the project is an economic organization with foreign investment capital, after the decision to allow the transfer and the parties have signed the transfer contract, land procedures will be carried out. land according to the provisions of land law.
This point overcomes the disadvantage of the 2014 Real Estate Business Law: the transferor must return the land to the State so that the State can allocate the land to the transferee.
Adjust the draft to refer to the Land Law (amended) to ensure uniformity. The Land Law (amended) is being drafted in the direction that the transferee inherits the rights and obligations of the transferor, without having to recover/deliver land or recalculate land use fees…
- Payment in real estate business
Project investors and real estate businesses receive payment through banks; Individuals doing small-scale real estate business, organizations and individuals selling houses and construction works for non-business purposes or on a small scale are not required to go through banks.
This regulation aims to institutionalize Resolution No. 18-NQ/TW: Improving the legal basis and strengthening the implementation of non-cash payments in real estate transactions.
- Transfer of real estate business contracts
Only 3 types of transferable contracts are stipulated: Contracts for buying and selling houses formed in the future; Lease purchase contract for housing formed in the future; Lease purchase contract for construction works is available.