Buying property in Hanoi
With its economy on the rise and a plethora of exciting and innovative projects in the pipeline for the next decade, Hanoi is firmly in the sights of many a foreign investor. The capital citys middle class has been rapidly growing over the past few years, and the housing market is steadily accelerating in value. Transportation upgrades and various infrastructure projects have seen a myriad of foreign investments since 2015, and although Saigon dominates Vietnam’s business sphere, Hanoi is not to be underestimated.
Buying property in Hanoi is simple enough, but all documents must be completed in Vietnamese, make sure you have a reliable translator.
Hanoi boasts a varying ensemble of charms and challenges, and it simply depends on the area you choose to live in. First and foremost, foreigners cannot buy land here, as this owned by the people and regulated by the state. One of the most notable areas of the capital city is Tay Ho, a very green and high-end area abundant with expats. Housing prices in this part of town are typically at their highest, compared with other districts of Hanoi. Cau Giay is another attractive district and is home of Keangnam Hanoi Landmark Tower, Hanoi’s tallest building. This area is popular with expats from other Asian countries like Japan and South Korea.
The diamond is in the detail
On a street level, foreigners are often charged slightly more than the basic rate. As Vietnam is a developing country, it is important to remember this practice will occasionally, transcend into the housing business too. As a rough guide, buying an apartment outside the city centre starts as low as 18 million VND (600 GBP) per square metre. Vietnam’s housing law seems simple upon inspection, as it states that anyone with a Vietnam visa in their passport can potentially buy property. The realities, of course, are a little more technical, but the most common ways of buying property include the following:
Setting up a company in Vietnam (100% foreign owned)
Provided no additional licences are needed, this process should take a month or two. You will need to contact the Department of Planning and Investment (DPI) to get your Investment Registration Licence, which will allow you to start a business in Hanoi. From here, a Business Registration Certificate will need to be obtained, giving you a further 90 days to make the initial investment. The investment licence will typically last for ten years.
Forming a joint venture
Going into business with a Vietnamese shareholder will allow you to purchase households and real estate projects, as well as buildings for sale. While Vietnamese citizens can lease property indefinitely, local companies may lease until the termination of the company. One of the most common mistakes foreign investors make is using unreliable nominees, so it pays to thoroughly research trusted partners first. Emerhub has an outstanding reputation throughout Vietnam and other Southeast Asian countries.
Buying as an individual
Foreigners who are residents are legally allowed to buy property in Hanoi, however, under the condition that it is for personal dwelling only. Properties owned by individuals cannot be rented to third parties and are subject to a lease term of 50 years. These leases are renewable. If you are married to a Vietnamese citizen or are an overseas Vietnamese, you are granted freehold tenure on any property you own.
Sealing the deal
After choosing a property of interest, the first step will be to sign a reservation agreement, linking the seller and yourself. This will typically involve paying a deposit. Due diligence must be paid here, and it is strongly recommended that you notarize the reservation agreement to protect your interests legally. Ensure the seller is legitimate by requesting to see their identification and property ownership certificates. Details of their insurance or a bank guarantee will also reinforce their integrity and trustworthiness. Purchase agreements must be drafted in Vietnamese, so it is imperative you have a reliable translator there with you.