Vietnam proposes limiting foreign home ownership to apartments
Foreign buyers would be limited to apartments under proposed rules aimed at curbing speculation, as home prices exceed 19 times median income.
- Vietnam is proposing new legislation that would ban foreigners from buying detached houses, villas, and townhouses, limiting their property ownership to apartments only.
- The government's stated goal is to curb property speculation and control soaring home prices, which have made housing unaffordable for many local citizens.
- Under the proposed rules, foreign ownership would be capped at 30% of the units in any single apartment building for a term of up to 50 years, with a possible extension.
- If the bill is approved by the National Assembly, the new restrictions on foreign home ownership are scheduled to take effect on March 1, 2027.
Vietnam is preparing strict rules to “ban foreigners from buying detached houses, villas and townhouses”, allowing them to own only apartments as home prices rise to more than 19 times the median income, putting ownership beyond the reach of many people.
The measures aim to curb speculation and rein in an overheated property market, but could affect luxury housing and encourage foreign investors to seek ways around the law.
Vietnam is proposing major amendments to its housing legislation to “remove foreigners’ rights” to purchase houses with land, including detached houses, villas and townhouses in approved developments.
Foreign buyers would retain only the right to purchase and own apartments in residential buildings.
The bill is scheduled for consideration by Vietnam’s National Assembly between October 17 and November 20 and, “if approved”, would take effect on March 1, 2027.
The move is consistent with Resolution 21 of the Communist Party of Vietnam, adopted on July 28, which reaffirms the principle that “land is collectively owned by the people, with the State acting as the owner’s representative”.
The resolution also explicitly prohibits the privatisation of land and bars foreigners from receiving transfers of land-use rights in any form, with an exception for Vietnamese people living overseas.
The Vietnamese government argues that speculation and land hoarding are distorting the property market, pushing home prices beyond people’s purchasing power and worsening inequality.
As Vietnam’s economy expands rapidly, housing prices have climbed to more than 19 times median income, making home ownership increasingly difficult for many people.
Reaffirming the Communist Party’s position, the government describes property speculation as “a game played by market manipulators” that widens inequality and diverts resources from production, innovation and economic activities that create real value.
Under the bill, foreigners would be allowed to own only apartments, subject to a limit of 30% of the total number of units in each building.
Ownership would be permitted for up to 50 years, with an extension of up to another 50 years under specified conditions.
Purchases would remain prohibited in areas sensitive to national security and defence.
The measures could affect the luxury property market, particularly villas and seaside holiday homes popular with foreign buyers seeking properties for their own holidays or to rent to tourists.
David Jackson, chief executive of Avison Young in Vietnam and Cambodia, warned that tighter restrictions could encourage foreign buyers to hold properties through agents, companies or powers of attorney.
Such arrangements carry the risk of legal disputes and could make the property market less transparent.
Meanwhile, experts believe the measures could redirect foreign demand from houses with land towards the condominium market, parts of which are experiencing oversupply, even as domestic demand for affordable housing remains high.
Figures from Vietnam’s Ministry of Construction show that foreigners have purchased 1,519 homes since the 2023 Housing Law took effect.
Including earlier purchases, the total is estimated to exceed 6,000 units.
For foreigners who already own houses with land, Tran Long of law firm APFL Partners expects the government may introduce transitional provisions to protect existing rights, without requiring owners to sell properties held lawfully.
If approved, the legislation would mark a major shift in Vietnam’s property policy, which has allowed foreigners to purchase both condominiums and houses with land since 2014.
It reflects the government’s efforts to control speculation and prioritise access to housing for its citizens over opening the property market to foreign capital.
