Circular No. 20/2010/TT-BXD guiding the pilot determination and publication of certain indices evaluating the real estate market

CIRCULAR

Guidelines for piloting the determination and publication of certain

 indices to evaluate the real estate market

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Pursuant to Decree No. 17/2008/NĐ-CP dated February 4, 2008 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Construction;

Pursuant to Decree No. 153/2007/NĐ-CP dated October 15, 2007 of the Government detailing and guiding the implementation of the Law on Real Estate Business;

The Ministry of Construction provides guidelines for piloting the publication of certain indices to evaluate the real estate market as follows:

PART I

GENERAL PROVISIONS

Article 1. Purpose, scope of regulation and applicable subjects

1. This Circular guides the pilot determination and publication of certain indices to evaluate the real estate market (hereinafter referred to as "indices") of Hanoi City, Ho Chi Minh City, Da Nang City, and Can Tho City.

2. The indices published according to these guidelines serve as a basis for relevant agencies, organizations, and individuals to refer to and use in managing the real estate market at the local level.

3. It is encouraged that other provinces and cities apply the provisions of this Circular to determine and publish indices to evaluate the real estate market to serve the management of the real estate market at the local level.

Article 2. Types of real estate and evaluation indices

1. The types of real estate selected to build the indices include:

a. Real estate for sale or transfer:

- Apartment units;

- Single-family houses;

- Land plots;

b. Real estate for lease:

- Office space.

2. The indices to be published include:

a. Real estate transaction price index including:

- The overall real estate transaction price index of the locality;

- The real estate transaction price index for each type of real estate in each area of the locality.

b. Real estate transaction volume index including:

- The real estate transaction volume index for each area and of the locality;

- The real estate transaction volume index for each type of real estate in each area and of the locality.

Article 3. Definitions:

In this Circular, the following terms are understood as follows:

1. Apartment unit refers to apartment units within residential buildings classified according to current regulations (including Class 1, Class 2, Class 3, and Class 4 residential buildings).

2. Single-family house refers to a type of housing (excluding apartment units) established in streets, existing residential areas, new urban areas, and housing projects.

3. Land plot refers to land used for residential purposes formed in new urban areas, housing projects, and existing land in streets and residential areas.

4. Office space refers to floor area used for work purposes.

5. Real estate transaction price index reflects the degree of price fluctuation of real estate through successful transactions over time.

6. Real estate transaction volume index reflects the degree of fluctuation in quantity (including quantity in terms of area or number of real estate units) of successful real estate transactions over time.

7. Real estate transaction price is the price of real estate successfully traded on the market during the calculation period, not the initial transaction price of newly formed or newly created real estate.

8. Real estate transaction volume is the number of successful transactions of various types of real estate during the calculation period.

9. Base period is the period chosen as the base for comparison.

10. Comparison period is the period required to determine the indices for comparison with the base period or another comparison period.

11. Representative real estate is the real estate selected with common characteristics representing a specific area during the calculation of the real estate transaction price index.

Article 4. Principles and requirements for publishing indices

1. Published indices must be complete and timely, reflecting accurately the fluctuations of the real estate market at the local level.

2. The published indices include indices for each area and general indices for the locality.

3. The unit of measurement for the indices is percentage (%).

4. The published indices are made public widely through various means of communication.

Chapter II

DETERMINATION OF MARKET ASSESSMENT INDICES FOR REAL ESTATE

Article 5. Base period and comparison periods

1. The base period selected is the first quarter of 2011.

2. Comparison periods:

- Each quarter and annually compared to the base period.

- The previous quarter compared to the subsequent quarter.

- Each quarter and annually compared to the corresponding period of the previous year.

Article 6. Collection of data to determine indices

1. Data related to real estate transactions are collected from the following sources:

- From relevant state management agencies at the local level through notarized contracts on real estate transactions, registration of ownership and use rights of real estate, obligations to pay taxes on real estate transactions. The compilation of data is carried out according to the reporting form attached as Appendix No. 2 to this Circular.

- From real estate trading floors; from market surveys and investigations. Details of the survey and investigation forms are attached as Appendix No. 3 to this Circular.

2. The collection and storage of data related to real estate transactions are conducted monthly.

Article 7. Determination of indices

1. The determination of indices assessing the real estate market is carried out according to the guidelines set forth in Appendix No. 1 to this Circular.

2. In cases where necessary, the agency entrusted with organizing the construction of indices may hire organizations or individuals with expertise and experience in real estate valuation to perform certain tasks or the entire work of collecting data, calculating, and determining indices. Organizations or individuals hired must bear responsibility before the agency entrusted with organizing the construction of indices and before the law regarding the truthfulness and objectivity of the collected and calculated data.

Prior to publication, the agency entrusted with organizing the construction of indices has the responsibility to review and evaluate the appropriateness of the data performed by the hired organizations or individuals.

3. The source of funds for collecting data, calculating, determining, and publishing indices is balanced from the annual local budget.

Chapter III

PUBLICATION OF MARKET ASSESSMENT INDICES FOR REAL ESTATE

Article 8. Content of publication

1. The published indices include transaction price indices and transaction volume indices for real estate.

2. The published indices are categorized by type of real estate, by area, and generally for the locality.

Article 9. Publication time

1. Indices are published quarterly and annually.

2. Publication times:

- For indices published quarterly: publication is carried out in the first month of the subsequent quarter.

- For indices published annually: publication is carried out in the first quarter of the subsequent year.

Article 10. Organization of publication

On a regular basis, quarterly and annually, the agency entrusted with leading the organization of constructing indices in the selected pilot localities is responsible for publishing the indices on various means of communication.

Chapter IV

IMPLEMENTATION

Article 11. The Ministry of Construction shall be responsible for

1. Guiding relevant localities to organize the construction and publication of indices as prescribed in this Circular.

2. Urging and periodically inspecting the implementation of regulations set forth in this Circular.

Article 12. People's Committees of cities implementing pilot projects shall be responsible for

1. Directing the organization of the implementation of the provisions of this Circular.

2. Entrusting the Department of Construction to take the lead and coordinate with related units to establish a database on real estate transaction prices, the number of real estate transactions, and to determine and publish indices as prescribed in this Circular. The first publication of these indices shall be from the third quarter of 2011.

3. Entrusting the Department of Justice, the Department of Finance, and the Department of Natural Resources and Environment to direct subordinate units to provide information; compile and store data related to real estate transactions; submit quarterly consolidated results to the Department of Construction for compilation and calculation.

4. Allocating financial resources to organize the construction and publication of indices.

5. Entrusting the Department of Construction to compile and report periodically published indices to the Ministry of Construction for monitoring and inspection.

Article 13. Implementation Provisions

1. This Circular takes effect 45 days from the date of signature.

2. In case of difficulties during implementation, please send comments to the Ministry of Construction for consideration and resolution./.