Decision No. 06/2004/NQ-CP On certain measures to develop a healthy real estate market

RESOLUTION

On some solutions for the healthy development of the real estate market

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The Ninth Plenary Session of the Central Committee of the Communist Party of Vietnam's Ninth Congress affirmed that one of the main goals and tasks regarding economic development in the remaining half-term of the Ninth National Congress is to form a comprehensive range of markets, including the requirement to "urgently guide the implementation of the Land Law 2003 and related legal documents to develop and manage the real estate market effectively; apply strong, synchronized measures to eliminate state subsidies, curb speculation, artificial demand stimulation, false housing shortages, 'fever' in the real estate market, corruption, illegal land occupation, and wasteful land use. Implement regulatory policies to ensure the interests of the State as the representative owner and the largest investor in infrastructure development, thereby increasing the value of land."

The current status of the real estate market in our country, as well as the urban and urban development area real estate markets over recent years, has shown positive changes, contributing to the promotion of national socio-economic development at a relatively high pace. Many projects in production, business, and service sectors have mobilized social capital, gradually improved the efficiency of production and business operations, the living standards of the people, and transformed the appearance of cities and rural areas, contributing to the restructuring of the economy towards industrialization and modernization. Through the practical activities of the real estate market in our country, the investment environment and legal framework have been formed in the direction of developing a socialist-oriented market economy.

Along with these positive aspects, the operation of the real estate market in recent times has also revealed weaknesses: due to insufficient understanding of the role and position of the real estate market in socio-economic development requirements, real estate assets have not been effectively utilized, leading to significant waste and loss; the State has not had effective management and regulatory solutions for the real estate market; speculative activities in real estate, artificial demand stimulation to inflate real estate prices have become quite common; unauthorized changes in land use purposes, informal land transactions, and unauthorized construction... have negatively impacted investment activities and planning and construction management, reduced budget revenues, adversely affected public psychology and livelihoods, especially low-income individuals and households whose land was reclaimed, and made urban development unsustainable.

To address the above situation and achieve the goal of developing a healthy real estate market, particularly for residential real estate in urban and urbanizing areas, it is necessary to focus on implementing several solutions in the near future, which are::

I. GOALS FOR DEVELOPING THE REAL ESTATE MARKET

1. Efficiently exploit and utilize all types of real estate, especially residential real estate, to maximize resources from land, buildings, and structures to promote socio-economic development and serve the cause of national industrialization and modernization.

2. Attract various sources of social resources, encourage all economic sectors to participate in investing in real estate products, particularly in constructing production and business facilities, technical infrastructure, and social infrastructure.

3. Contribute to forming a comprehensive range of markets and appropriate institutions in line with a socialist-oriented market economy and international integration.

The State should proactively set directions, regulate, and control to stabilize the real estate market, addressing spontaneous and speculative activities in the real estate sector.

II. SOLUTIONS FOR DEVELOPING THE REAL ESTATE MARKET

A. GENERAL SOLUTIONS

1. Focus on building and perfecting a legal system and mechanisms and policies that ensure consistency, unity, and effectiveness to create conditions for the real estate market to operate according to legal regulations. Policy formulation must ensure synchronization and consistency, minimizing state intervention in economic relations to fully leverage the potential of real estate participating in the market to serve socio-economic development. Enhance competition, remove bottlenecks to ensure the healthy operation of the market and effectively manage the real estate market while creating conditions for active economic integration; concentrate on drafting the Law on Real Estate Business, the Law on Real Estate Registration, the Law on Housing, the Law on Land Use Tax, and the Law on Property Tax according to the legislative program of the National Assembly; along with urgently drafting guiding documents for the Land Law and Construction Law, review, amend, and supplement existing legal documents related to the real estate market to resolve overlapping, contradictory, or outdated provisions that limit the effectiveness of the real estate market.

2. Study adjustments and supplements to certain taxes and fees related to real estate in the direction of encouraging efficient use of real estate, while promoting formal transactions in the market. Through taxes, fees, and charges, the State regulates the real estate market, particularly differential ground rent for cases where the State invests in infrastructure, encourages efficient use of land resources, curbs speculation, and reasonably reduces taxes and fees in real estate market transactions to encourage formal transactions, address informal transactions, and behaviors evading financial obligations causing revenue losses to the state budget.

The Ministry of Finance shall take the lead and coordinate with relevant ministries and sectors to study amendments and supplements to taxes and fees related to residential real estate in the aforementioned direction to submit to the Government for approval by the National Assembly in 2005.

3. Improve credit policies to serve the development needs of the real estate market; study and improve mechanisms and policies on mortgage - release from mortgage, guarantee, as well as the handling of mortgaged real estate for debt recovery, facilitating enterprises and individuals to mortgage real estate to borrow funds for economic development; propose long-term loan solutions with appropriate interest rates for rental housing construction, phased payment housing sales, and other types of housing to support the development of goods for the real estate market.

The State Bank of Vietnam shall take the lead and coordinate with the Ministry of Justice and relevant ministries and sectors to study and submit to the Government for issuance in 2004 policies on registering secured transactions, mortgage, guarantee, registration of secured transactions, and handling of mortgaged real estate for borrowing; long-term loan solutions with appropriate interest rates for phased payment housing purchases and rental housing construction.

4. Enhance the supply of real estate products, especially land for production and business, and residential real estate to proactively stabilize the market according to supply and demand laws, while contributing to implementing social policies. To effectively implement this solution, in addition to developing land reserves to regulate the market as stipulated in the Land Law of 2003, it is necessary to encourage all economic components to invest in residential real estate development, as well as other commercial real estate types, particularly rental housing and phased payment housing, through policies that create conditions for low-income households and disadvantaged policy beneficiaries to improve their living conditions, based on the principle of eliminating subsidies and implementing support policies suitable to the socio-economic situation, budget capacity at the national and local levels. Resolutely recover and organize public auctions of land lots in projects where secondary developers have not invested within 12 months without permission from competent state authorities.

The Ministry of Construction shall take the lead and coordinate with the Ministry of Labor, Invalids and Social Affairs, the General Confederation of Trade Unions of Vietnam, and relevant ministries and sectors to develop a housing project applicable to low-income individuals and social policy beneficiaries to be submitted to the Government in the fourth quarter of 2004; simultaneously, coordinate with the Ministry of Planning and Investment to guide localities in inspecting the implementation of comprehensive urban and housing development projects and report to the Prime Minister in the second quarter of 2005.

The Ministry of Planning and Investment shall take the lead in studying mechanisms and policies to attract resources from domestic and foreign residents and organizations to participate in real estate investment and business; coordinate with the State Bank of Vietnam to seek ODA funds from abroad and international financial institutions to supplement loans for real estate development investment and propose solutions to develop a synchronized real estate market in terms of development level with other markets in the economy to be submitted to the Government for issuance in 2004.

5. Gradually improve the structure of the market and ensure healthy transactions in the real estate market, with particular emphasis on establishing "Land Transaction Floors" to implement auction, bidding, or挂牌出售等各种形式进入房地产市场的土地以及“房地产交易中心”以方便主体更容易参与市场，确保市场公开透明并受国家管理，限制投机行为，稳定市场。规定在国有土地出让和租赁项目中出售房屋和转让土地使用权必须公开进行，以便所有有需求的对象都能通过房地产交易中心获取相关信息；完善和增强房地产咨询、中介、保险和信息组织的运作能力，为房地产市场的透明高效运行创造条件。.

In 2004, the Ministry of Natural Resources and Environment will guide key localities in piloting the organizational model and operation of "Land Transaction Floors" to implement land allocation and leasing through forms such as auctions and bids, ensuring transparency and simplifying procedures to achieve high efficiency.

The Ministry of Construction will complete in 2004 the guidance to localities on improving the organizational model and operation of "Real Estate Trading Centers" towards socialization to facilitate subjects' easier participation in real estate transactions under their ownership in the market, enhance the circulation of goods, ensure market transparency and regulation by the state.

Provincial People's Committees shall stipulate that investors in projects allocated land or leased land by the state may raise capital through public auction methods and publicly announced prices to allow everyone with housing needs to participate.

B. EMERGENCY SOLUTIONS

To achieve the goal of developing a healthy real estate market, in the short term, focus on real estate in stable-use cities, real estate in urbanized areas, and real estate already allocated to management units but not yet paid for, with specific measures as follows:

1. For real estate in cities already put into stable use:

a) Concentrate on directing the issuance of property certificates in accordance with the law to ensure that all real estate products meet the legal conditions for legitimate and transparent transactions on the real estate market.

The Ministry of Construction and the Ministry of Natural Resources and Environment shall direct provincial and municipal people's committees to complete the issuance of property certificates in accordance with the law by 2005, ensuring simplified procedures to facilitate owners in exercising their rights and fulfilling their obligations during use and transactions on the real estate market in accordance with the law.

Article shall soon study and promulgate regulations on issuing certificates of ownership for houses and constructions that require transactions on the real estate market, first and foremost for areas with approved detailed planning. The Ministry of Construction shall take the lead and coordinate with relevant ministries and sectors to research and draft specific regulations on issuing ownership certificates for this type of real estate to promulgate within its authority or submit to the Government for promulgation at the latest in the first quarter of 2005, serving as a basis for provincial and municipal People's Committees under the Central Government to implement.

b) To effectively implement the policy of socializing housing issues, creating conditions to maintain and upgrade the national housing fund, the Ministry of Construction shall urge localities to simplify procedures to promote the sale of housing to tenants according to Decree No. 61/CP dated July 5, 1994, to be completed at the latest by 2005. Provincial and municipal People's Committees under the Central Government shall promptly implement appropriate measures to effectively exploit this housing fund, including reconstruction according to planning for houses that cannot be sold or can be sold but tenants have no interest in purchasing.

c) Provincial and municipal People's Committees under the Central Government shall adopt concrete measures to strictly manage new construction, renovation, and upgrading of housing to ensure requirements of planning, architecture, environmental hygiene, environment, and urban infrastructure, resolutely preventing and eventually stopping the phenomenon of spontaneous housing construction in urban areas and along major traffic routes.

2. For houses and land in urbanized areas:

To develop and manage the real estate market effectively, it is necessary to comprehensively renew the work of planning and managing construction according to plans. All levels of People's Committees must focus on implementing urban development plans and rural residential area plans as a basis for investment development and management of construction according to plans to address the issue of spontaneous construction and construction contrary to plans, specifically:

a) Provincial and municipal People's Committees under the Central Government must concentrate on directing the preparation of detailed urban construction plans at a scale of 1/500 and rural residential area plans with high quality as a basis for strict management of investment construction activities. Publicize detailed plans to enable organizations and individuals with needs to easily access necessary information, addressing fraudulent real estate sales and false demand stimulation, artificially inflating real estate prices;

b) The Ministry of Natural Resources and Environment shall direct localities to strictly manage land use, particularly changes in land use purposes in urbanized areas; all projects must be included in land use plans approved by competent authorities;

c) Based on approved detailed plans, apply bidding, auctioning, or posting methods for land areas intended for commercial real estate development. For lands serving other requirements, apply land price policies in accordance with the Land Law 2003;

d) Based on detailed plans approved by competent authorities, local People's Committees shall, based on actual conditions, combine road opening with land reclamation on both sides of roads to proactively build complete roads and streets while using land revenue from both sides of the roads effectively;

e) End the subsidy mechanism for enterprises operating industrial zone and export processing zone infrastructure as well as preferential policies for enterprises operating commercial housing real estate in urban and urbanized areas;

f) Local People's Committees have the responsibility to direct and inspect compensation and land clearance work for all real estate development projects, ensuring compliance with policies. Compensation and damage claims when land is reclaimed must be transparent so that the public understands and agrees. Real estate development and business projects may only clear land when relocation sites have been prepared, ensuring the principle that relocation sites must be better than previous residences;

3. For state-owned houses and land allocated to agencies and units for management and use without payment:

a) The Ministry of Construction shall take the lead and coordinate with the Ministries of Finance and Natural Resources and Environment to direct provincial and municipal People's Committees under the Central Government to implement investigations and statistics on the current status of houses and land as well as their usage by organizations and agencies, and report to the Government no later than June 2005. During the investigation and statistics process, if cases of houses and land currently being used by agencies and organizations for improper purposes, wastage, loss, or lax management are identified, they must be recovered and utilized effectively;

b) The Ministry of Construction shall cooperate with relevant ministries and sectors to develop a proposal to effectively utilize state-owned real estate recovered and report to the Government in the fourth quarter of 2005.

III. IMPLEMENTATION

1. Reform perceptions about the real estate market to create mechanisms and policies to promote the development of this market alongside capital markets, labor markets, science and technology markets, and other markets, providing impetus for economic and social development, contributing practically to sustainable urban and rural development in line with industrialization and modernization of the country.

2. Ministries and sectors shall base themselves on their assigned functions and tasks, organize research, and submit to the Government for promulgation or promulgate within their authority mechanisms and policies to implement solutions to promote the healthy development of the real estate market in accordance with the spirit of the Government's Resolution no later than the fourth quarter of 2005.

3. The People's Committees of provinces and centrally governed cities shall immediately implement measures to enhance management capacity and effectiveness for the real estate market in 2004, primarily by effectively implementing solutions to develop a healthy real estate market locally, while intensifying inspection, supervision, and strictly handling organizations and individuals who violate the law; conducting comprehensive inspections of apartment building construction projects that have been and are being implemented in Hanoi and Ho Chi Minh City.

4. The Ministry of Construction and the Government Office shall be responsible for monitoring, urging, inspecting, and periodically compiling reports to the Prime Minister on the implementation of this Resolution. Any difficulties must be promptly referred to the Prime Minister for guidance.

5. Ministers, heads of ministerial-level agencies, heads of government agencies, and Chairmen of the People's Committees of provinces and centrally governed cities are responsible for enforcing this Resolution./.