How to Buy Property on Vietnam’s Secondary Market?

, How to Buy Property on Vietnam’s Secondary Market?

Purchasing real estate products on the secondary market is no easy task, but there are ways to reduce the hassles.

The secondary real estate market in Vietnam involves property transactions that are made after the first sale. To purchase an apartment on this market, prospective buyers should first see whether their property has a pink book available to it or not (an important certificate of ownership in Vietnam). This will decide the steps to purchase accordingly.

In the previous article, we talked about how to purchase property on the secondary market with a pink book ready. For properties that haven’t received one, you’ll learn how to buy them in this article.

What to do if my property hasn’t received a pink book yet?

In some cases, this could be due to the fact that it was just purchased on the secondary market and development is still underway. As a result, there is currently no pink book accessible for this sort of property.

In this situation, the Sales and Purchase Agreement (SPA) must be signed by both the original buyer and the housing developer to legitimize the transaction. The process is slightly different when a second buyer (Person B) wants to acquire the property from the first buyer (Person A).

Step 1: Transfer the SPA

At the notary office, Person A and Person B will sign the SPA. The following information is included in the contract transfer:

  • Person A’s and Person B’s personal information,
  • Selling price,
  • Payment methods,
  • Payment terms,
  • Person A’s and Person B’s rights and obligations,
  • Other terms and conditions.
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Keep in mind that this SPA transfer contract must be notarized in seven copies at a notary office.

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Step 2: Make taxed payments

Following the notarization of the transfer documentation, both Person A and Person B will be required to pay taxes.

Person B must pay a registration tax of 0.5% of the property’s worth, whereas Person A must pay personal income tax (2% of the property value).

Step 3: Get confirmation from the developer

After notarizing the transfer contract in step 1, the buyer must present the developer with the following documents to finalize the transfer:

  • 5 originals signed by the buyer (Person B) and the seller on the SPA transfer (Person A)
  • Tax payment receipt obtained for paying taxes in step 2
  • Initial SPA between the seller (Person A) and the developer
  • For verification, certified or original copies of ID/passport are required
  • Within 5 working days, the developer must certify the SPA transfer

Person A will keep one copy of the SPA transfers signed by the developer, while Person B will keep the other.

Following that, the developer will provide the following documents to the applicant (Person A):

  • The first SPA between the developer and the seller (Person A).
  • A certified copy of the transfer of ownership record (if the developer has already handed over the property to Person A).
  • Tax receipts or documentation of tax deductions that comply with tax laws are acceptable.

After these documents are signed, the transaction is complete, and the buyer (Person B) is the new owner of the property. Following the completion of these documents, the buyer becomes the legal owner of the property.

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Conclusion

Purchasing real estate products on the secondary market is no easy task, but there are ways to reduce the hassles.

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Homebase streamlines the buying process to help their customers gain ownership more quickly and easily. With steady fundings from global institutions (Y Combinator, Antler, VinaCapital and others), Homebase continues to be a trusted partner to expedite the homeownership journey for buyers across Southeast Asia.

To learn more about Homebase, contact their team at +84 94 823 00 33 or visit http://homebase.com.vn/.

This article is a part of Homebase’ Real Estate 101 series and was co-created with their team. Homebase is a proptech company in Vietnam that provides foreigners with a more flexible alternative to homeownership. For more information, please visit http://homebase.com.vn/.

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