Viet Nam needs to create a land fund for the property market by preparing masterplans that set out clear land-use objectives, a land management official said last Saturday.
Phung Van Nghe, Acting Director of the Land Management Department under the Ministry of Natural Resources and Environment, also suggested at a seminar on land policies vs property market in HCM City that the government reconsider its current land pricing policy.
"Right now, the pricing policy, which decides the base-price on which land use right and other fees are based, is based on location, infrastructure and land use purposes, but fails to consider the master-planning factor, which impacts land and property prices," he explained.
Nghe also stressed the need for rational taxation policies covering earnings from real estate deals, especially the transfer of land-use rights, in order to reduce speculation.
Market transparency better, service poor
Between 2004 and August 2010, the HCM City Land Fund Development Centre paid compensation and collected 53 land lots totaling 375ha.
Seven land lots covering 62ha were auctioned for VND1.34 trillion (US$70 million) and another 75ha were handed over for public works.
From 2002 to date, the city withdrew decisions on 91 projects covering 1,395ha because of undue delay. Over 260 real estate trading floors that are eligible to operate in the city have helped improve the market's transparency, but service quality is still poor.
He said the current registration system was inadequate, for it did not record important information including assets on a land lot or the financial liabilities not yet fulfilled by the users of the land.
Dao Anh Kiet, Head of the HCM City's Natural Resources and Environment Department, agreed on the need for a comprehensive land and real estate assets management system that is updated regularly with every change in ownership or other factors.
He also said a system that allows the public to access accurate and timely information on land and properties for a fee should be set up, and the fees used to maintain and upgrade the system. The information system should ensure the security of personal information, he said.
Kiet recognised improvements that have been made in administrative procedures, but added they were still complicated and cumbersome. For example, land allocation for investment projects still has to go through various authorising organisations, he noted.
"Policies and regulations have seen many changes, but they still do not meet with the demands of urbanisation and development. Compensation for land clearance is snared in difficulties because of pricing," he said.
Dr. Tran Kim Chung from the Central Institute of Economic Management spoke of lessons that Viet Nam can learn from other countries.
He cited the example of countries like Singapore, the Philippines and Finland, which have created agencies responsible for housing construction with a focus on low-income people.
"In several countries, there are clear financial channels for real estate development including credit from commercial banks, bond and securities as well as real estate investment trust funds," he said.