Since Vietnam opened up to foreign property buyers in 2015, investors pour in to grasp a share of the Saigon property market.
But even if Vietnam has relaxed the regulations on foreign ownership, there are important fundamentals you need to be aware of before buying property.
In this article, I interview Rudy Bui, who is the Founder and Director of the law firm Bui & Brothers LLP.
It’s an established firm that works with both Real estate & Construction law and Tax law in Ho Chi Minh City (Saigon).
Rudy, please tell us a bit about your background and current business
I’m a qualified lawyer with more than 10 years of practicing law in foreign and local law firms in Vietnam.
I earned a Master of Law in South Korea, recently admitted as a Scholar of the International Bar Association (IBA) and the Inter-Pacific Bar Association (IPBA).
Currently, I’m running my own law firm named BUI & Brothers Law Firm, involving foreign direct investment, corporate and commercial issues, construction, real estate business, and dispute resolution and arbitration practice.
I have assisted many foreign clients wanting to buy properties in Vietnam. We believe that we are capable of getting clients’ need fulfilled in the best way possible.
Why should foreigners hire a Law firm like yours, when buying a property in Saigon?
We can help to investigate the legal status of the property associated with the project, and act for foreigners to successfully negotiate with the project owner and real estate agent.
Drafting or reviewing the sale and purchase agreement is our scope of work to assure clients’ rights and interests.
It’s essential to do this correctly, to reduce risks when buying property here in Saigon.
What are the most common issues that foreign buyers encounter when buying property in Saigon?
Foreigners often encounter issues with:
· Assignment/transfer of property
· Seller’s fail to transfer the property on time
· Built-in furniture and accessories/home appliances
· Right to use of the property after handover
· Claims for defects after handover
It’s important to do due diligence beforehand and seek help from a local professional. It’s not easy to navigate in a foreign country, especially where the locals often speak no or limited English.
How do you usually help them to resolve these issues?
It depends on the issues the client is confronting.
First of all, we will look at the Sale and purchase agreement (SPA). After, we approach the project owner and discuss possibility of remedying the clients’ issue in an amicable fashion.
The case can be brought to a dispute resolution body only if the project owner rejects the client’s request unreasonably.
How important is the ‘pink book’? Should I reject a deal in case the seller can’t provide me the ‘pink book’?
It’s important in two ways. First, it must be the project owner’s obligation to give the client a certificate of ownership, when the time comes.
Second, the certificate of ownership allows homeowners to fully perform the rights from buying the property.
Depending on the existing status of the property at the time of sale, the client shall consider to reject the deal. We can help foreigners with these kind of matters.
Recently, some foreign buyers had issues to receive their certificates of ownership when buying property in Saigon. How can non-resident foreigners assure that they will receive the certificate of ownership when buying a property?
There is no 100% guarantee for foreigners.
Although a seller promised to complete procedures required to give the certificate of ownership, the seller usually breaks their promise by delaying the submission of the certificate of ownership.
Again, the certificate of ownership is not an ultimate condition to be overlooked when buying property in Saigon. But owning the property in the form of having a Sales and purchase agreement (SPA) also guarantees the buyer’s ownership.
Are there any differences when buying property in different districts? For example, is it generally more risky or difficult to buy a property in District 7 compared to District 1?
From a legal viewpoint, no.
It should be correct in terms of profits earned, rather than ownership risks.
What are the major differences when buying an off-plan property compared to an established property?
There are no major legal differences. The main difference is the price of the property, which is the first thing to be considered.
The price for off-plan property is usually lower than established property.
Buyer’s should check for infrastructure projects to be built close to the property, such as transportation systems, roads and schools, just to mention a few.
Can foreigners buy land in Vietnam? I know that the land is jointly owned by the Vietnamese people. But can I buy land through a contractual setup with a local Vietnamese person or company for example?
Yes, foreigners can buy land associated with houses located in residential housing projects.
A company jointly established by a local Vietnamese and a foreigner is regarded as a foreign-invested company who is limited to own land in Vietnam.
Thanks Rudy. Finally, based on your experiences, can you give any general advices to foreigners that plan to buy a property in Saigon?
Try to find a real estate lawyer and rely on trusted project developers. The real estate lawyers should understand the client’s current and future needs and financial situations, to provide valuable and practical advice.