Director of the HCM City Department of Natural Resources and the Environment Nguyen Toan Thang said at a session discussing the city’s socio-economic development on August 1 that under the 2024 Land Law (amended), the provincial people’s committee has the right to reconsider, use and adjust old land price frameworks. 

Therefore, HCM City plans to adjust the existing land price framework, not build a new one.

In principle, the process of adjustment consists of seven steps and six have been taken so far. The data collected by consultancy unit have been verified and transferred to the working group of the HCM City People’s Council for consideration.

“This is just the adjusted version, while the new land price framework will only be built and applied from January 1, 2026,” Thang said.

“The department is adjusting and updating land prices based on market transactions, checking the approved compensation prices and market prices to avoid loss in case the old price levels become out of date,” he said.

The prices of some areas in HCM City have been fixed at just VND1-2 million per sq m, while the real market prices in transactions are VND100-200 million. Therefore, the city needs to adjust the land price levels for temporary use.

The number of dossiers about land in HCM City continued to increase in July, with 40,000 dossiers, most of which related to the purchase, sale and mortgage for loans. The city collected VND12 trillion worth of tax from sources related to land in the last seven months.

HCM City Department of Natural Resources and the Environment are taking the last steps of the required procedures to submit to the People’s Committee to issue a land price framework for the city, in accordance with the 2024 Land Law.

Regarding the draft decision on adjusting the 2020 land prices compiled by the HCM City Department of Natural Resources and the HCM City Real Estate Association (Horea) has proposed the postponement of the adjustment and application, slated for August 1.

According to Horea, the compilation agency should focus on building a land price framework to be applied from January 1, 2026, because the Article 257 of the 2024 Land Law stipulates that the land prices set in accordance with the old land law will still be applied until December 31, 2025.

Horea chair Le Hoang Chau said the agency should ‘put itself in people’s shoes’ to understand why it would be better not to adjust the land prices at this moment.

Mr A. in Binh Hung commune of Binh Chanh district, is applying for a land use right certificate for a house built on a 100 sq m land plot adjacent to Nguyen Van Linh Road. The land plot was originally agricultural land, and was priced at VND6.8 million per sq m, in accordance with the 2020 land price framework.

If calculating the amount of money A has to pay based on the current price, A would have to pay VND660 million. If based on the adjusted land prices, the amount of money A has to pay would be up to VND6.18 billion.

In a similar case, Mrs B has the right to use the 200 sqm land plot on Nguyen Van Linh Road in Binh Hung commune of Binh Chanh district. Previously, because of limited financial capability, B just applied for the land use right certificate only for the area of 100 sq m on which she had built a house, while the remaining 100 sq m land area was used for short-term agricultural production.

Now, B wants to follow procedures to convert the remaining 100 sq m land area into residential land. Like A, Mrs B would have to pay land use fees of VND6.18 billion if new land prices are applied, instead of VND660 million based on the current price frame.

“If these households could choose tax calculation method, I believe that they would choose the current land price framework rather than adjusted prices. At present, there is no need to adjust the land prices,” Chau said.

Sources told VietNamNet that to date, the draft decision on 2020 land price adjustment has not been verified and approved by the HCM City Land Price Appraisal Council.

Anh Phuong