After the amended Housing Law allowing foreigners and overseas Vietnamese (also known as Viet Kieu) to buy property in Vietnam took effect in July, many Viet Kieu are optimistic about buying in homeland. To make the purchase smooth and less stressful, Viet Kieu should have a careful preparation.
Mr. Ngo Dinh Han, lecturer of real estate, Ho Chi Minh City University of Economics Ho Chi Minh City said the policies encouraging overseas Vietnamese return and buy houses in homeland is a positive stimulus to the domestic property market. However, in order to deal with many existing regulations and procedures, as a Viet Kieu, you need a good preparation before you start home hunting.
1. Prepare proof for your right to buy house in Vietnam
Viet Kieu have to show all the documents that prove your Vietnamese origin. These documents include: ID card, passport, other reference documents for nationality. the authorities which are responsible for certifying Vietnamese origin include: State Committee for Overseas Vietnamese Affairs, Vietnamese Representative Offices Abroad and provincial Department of Justice.
If you can’t prove the Vietnamese origin, you have two choices: buying house under a reliable relative’s name or buying as a foreigner with 50-year ownership and another 50 years after extension.
2. Prepare legal proof for money used home purchase
Money transferred from abroad to Vietnam for home purchase must comply with the provisions of law. You should ask for advice and guidance from banks and financial institutions for the best cooperation. For higher security, you should buy house with your own money to avoid risk of fluctuations in interest rate. All transactions shall be transferred via banks as this is the best way to prove the transactions.
3. Be careful with legal issues when buying home
As a Viet Kieu, you’d better buy properties that ensure transparency under Vietnam Law to avoid risks. Consider the prestige of developer before you sign the sales contract.
4. Consider type of real estate for investment
For investors, your intermittent presence in Vietnam may make the management and supervision of assets uncomfortable. Therefore, it’s best for you to invest in but-to-let properties. For this type of property, income will arise from the rent, along with value-added elements over time. Remember that location of the property plays an important role in increasing value of your investment.
5. Find a professional brokerage to support your home purchase
Entering an emerging property market like Vietnam, it’s unwise to carry out yourself all steps of the home purchase. You should find help from the third party – real estate broker to ensure a safe purchasing process. Brokerage agencies can provide you general information of the housing market, such as prices, property values and expectations as well as preliminary consultations on the purchase agreement.
6. Find a reliable manager for your property
It aims to effectively maintain your property and control issues that may occur while you are in abroad. If you have reliable relatives in Vietnam, you should ask them to manage your property. You can also hire a professional property manager. Regular maintenance can prevent rapid deterioration of assets due to lack of care.
7. Contact a lawyer for legal advice
Lawyers will assist you from drafting contracts to negotiating terms of sales contract with seller. In case that you want to sell assets in the country, you also need consultancy in specific rights and financial obligations.