This was the message sent by an economist who was commenting on articles about land issues published in VietNamNet. This seemingly pessimistic statement, six months after the Land Law 2024 took effect, accurately reflects the current situation: the state budget is overflowing, land prices are soaring, development opportunities are shrinking, and the wealth gap is at risk of widening.

The Land Law 2024 fundamentally changes the mechanism for determining land prices by abolishing the government-issued "price framework," replacing it with a land price list "aligned with market prices," established, published, and adjusted annually by provincial People's Committees.

In theory, this is a step toward market transparency, reducing public asset losses, minimizing prolonged disputes, and increasing state revenue. However, reality shows a fierce wave of price increases in most localities.

In Hanoi, the new land price list has risen by an average of 53 percent, with some areas nearly doubling compared to the old list. HCM City has seen increases of 50–60 percent in many areas, while Da Nang has recorded up to 100 percent increases in central locations. Binh Duong, Quang Ninh, Khanh Hoa, Hai Phong, and others have also raised land prices to unprecedented levels.

As land prices rise, associated financial obligations have also escalated: transfer taxes, land rental fees, land use fees, compensation costs for land clearance, appraisal fees, and licensing fees. State budgets have surged, but the economy's input costs are becoming increasingly expensive.

In the first six months of 2025, the Ministry of Finance (MOF) reported that the country collected nearly VND200,000 billion from land, a record figure, as many localities reported land-related revenue far exceeding projections, attributed to the application of market-aligned land price lists.

The player and the referee

Under current regulations, land belongs to the entire people, with the state acting as the representative owner and unified manager. However, in fact, the state not only regulates the market but also directly sets prices, allocates land, leases land, collects land use fees, and spends the resulting revenue.

Thus, the state is simultaneously acting as the lawmaker, the referee, and the beneficiary, an asymmetrical role that easily leads to conflicts of interest.

When budget revenue is prioritized, the land price list is no longer merely a tool reflecting supply and demand but can become a fiscal lever. Whenever localities need to increase revenue, the price list is adjusted upward. And citizens and businesses bear the cost.

As a result, land is no longer a means of production but is increasingly being viewed as a financial product for all players in the real estate market. Those who own land hold onto it, waiting for price increases or leasing it at high rates. Those without land are excluded from the market - whether for housing or production and business. 

Enterprises reported that land rental costs have risen sharply over the first half of 2025. The state, meanwhile, seeks to maximize revenue for other expenditure purposes.

Meanwhile, many small businesses, especially in craft villages, cannot keep up with the new land prices to expand production. Urban residents, particularly young people and workers, are increasingly distant from the dream of homeownership.

Land, once a resource and foundation for development, has become a money-making tool for all market players. Those who have land ‘sit on gold’, while those without land are pushed to the edge of development centers. When land becomes a "financial asset" without fair distribution, the economy and society will lose balance.

Increased land revenue may provide short-term budget relief, but it weakens the foundation for long-term development. Inflated land prices drive up investment costs, reduce competitiveness, and foster a speculative mindset over productive investment. This not only distorts the market but also stifles future development momentum.

To change this, first, it is necessary to recognize that land is not a ‘goldmine’ for budget collection, but a national resource and foundation for the people's development. The state cannot continue to simultaneously make laws, set prices, and profit; it must step back from being a "player" in the real estate market and return to its role as a "fair gatekeeper," "policy planner," and "creator."

Land price policies must be transparent, involve independent consultation, social feedback, and long-term stability, not chasing market waves. Land revenue should be reinvested in infrastructure, social housing, and remote areas, rather than covering routine expenses. Simultaneously, the land use tax system needs reform to curb speculation, tax abandoned land, and ease the burden on citizens and businesses with genuine usage needs.

Tu Giang