How to Buy Property in Vietnam as a Foreigner
Who can buy property in Vietnam?
Foreign ownership of real estate in Vietnam is allowed, but there are restrictions on the types of properties and the extent of ownership. Foreigners can buy apartments within commercial housing projects, but ownership is usually capped at 30% of the total units in a single building. While foreigners can own buildings or structures on the land, they cannot directly own the land itself.
Instead, foreigners can purchase property under long-term leasehold agreements, typically lasting up to 50 years, with the option to renew upon expiration. Residency in Vietnam is not required to purchase property.
Do the research
Investing in Vietnam real estate offers significant potential due to the country’s rapid economic growth and increasing urbanization. Vietnam has a young and expanding population, driving strong demand for housing and commercial properties, particularly in major cities like Ho Chi Minh City and Hanoi. Real estate prices in Vietnam remain relatively affordable compared to other Southeast Asian markets, providing opportunities for capital appreciation. The country’s stable political environment, improving infrastructure, and growing foreign direct investment make it an attractive destination for both local and international investors. Additionally, Vietnam’s tourism sector is booming, offering further opportunities in the hospitality and vacation rental markets.
Below are some sought-after destinations for real estate investment in Vietnam:
- Ho Chi Minh City - As Vietnam's largest city and economic powerhouse, Ho Chi Minh City (Saigon) is a prime location for both residential and commercial real estate. Key areas such as District 1, District 2 (Thao Dien), and District 7 are particularly popular for their modern lifestyle, international amenities, and accessibility. The city offers a mix of luxury condos and commercial spaces, making it a top choice for investors.
- Hanoi - The capital city of Vietnam, Hanoi, offers a blend of traditional charm and modern development. Areas like Hoan Kiem, Ba Dinh, and Tay Ho are known for their appeal to expats and investors. The city’s growing economy and strategic location make it an ideal spot for both residential and commercial real estate investments.
- Da Nang - This coastal city is renowned for its beautiful beaches and vibrant tourism industry. Popular areas like My Khe Beach and Son Tra Peninsula are ideal for luxury villas, holiday homes, and resort-style developments. Da Nang is also becoming a hub for digital nomads and retirees due to its relaxed atmosphere and high-quality infrastructure.
- Nha Trang - Famous for its long sandy beaches and islands, Nha Trang is a top destination for beachfront real estate investments. The city attracts both local and international investors interested in condos, holiday homes, and luxury resorts due to its booming tourism industry and strong rental market.
- Phu Quoc - As Vietnam's largest island, Phu Quoc is gaining popularity for its pristine beaches and growing tourism infrastructure. The island has seen significant development in recent years, offering opportunities for investors in resorts, beachfront villas, and vacation rentals.
Where to find properties online:
Financing
Foreigners can obtain property loans in Vietnam by working with local banks and financial institutions that provide mortgage programs tailored for international buyers. When applying for a loan, factors such as visa status, property type, and loan conditions will be considered.
Due Diligence and Sales Contract
Due diligence is essential as it helps identify any hidden issues with the property, whether legal or physical. This process involves verifying the property's legal status, ensuring there are no outstanding debts or legal disputes, and confirming the authenticity of property documents. Although not legally required in Vietnam, conducting due diligence is strongly recommended.
In Vietnam, the property purchase agreement, known as "Hợp Đồng Mua Bán Nhà Đất," is a formal contract that details the terms and conditions agreed upon by the buyer and seller. This legally binding agreement serves as a guarantee for both parties and includes specifics such as the property description, sale price, payment schedule, responsibilities of each party, and any conditions that must be met before the sale is finalized.
Property Buying Costs and Taxes in Vietnam
| Transaction Costs | ||
| Who Pays? | ||
| Property Transfer Tax | 2.00% | buyer |
| Legal Fees | 0.50% - 1.00% | buyer |
| Notary Fees | 0.05% - 0.10% | buyer |
| Real Estate Agent Fee | 1.00% - 3.00% | seller |
| Costs paid by Buyer | 2.55% - 3.10% | |
| Costs paid by Seller | 1.00% - 3.00% | |
| ROUNDTRIP TRANSACTION COSTS | 3.55% - 6.10% | |
| Source: Global Property Guide, PWC | ||
Footnotes to Transaction Costs Table
The round trip transaction costs include all costs of buying and then re-selling a property - lawyers' fees, notaries' fees, registration fees, taxes, agents' fees, etc.
Notary Fee
Notary fees are between 0.05% and 0.10% of the property value.
Transfer Fee
The transfer fee is 2.00% of the property value.