05 types of real estate and real estate projects permitted for trading under the new Real Estate Business Law?

This English version is translated from the Vietnamese original. In case of any discrepancy, the Vietnamese version prevails.

What Are the 5 Types of Real Estate and Real Estate Projects That May Be Put into Business Under the Real Estate Business Law?

The Real Estate Business Law 2023 (No. 29/2023/QH15), effective from 01/01/2025, provides in Article 5 five types of real estate and real estate projects permitted to be put into business on the market. This is the fundamental legal basis for enterprises to determine the scope of lawful activities before undertaking any real estate transactions.

Article 5 of the Real Estate Business Law 2023 establishes a list of types of real estate and real estate projects that may be put into business, which serves as the basis for determining objects falling within the scope of adjustment of this Law.

Specifically, the 5 types of real estate and real estate projects permitted to be put into business include:

1. Existing residential houses and residential houses to be constructed in the future – residential houses under lawful ownership of organizations or individuals put into business; residential houses in residential construction investment projects put into business;

2. Existing works and works to be constructed in the future – construction works (other than residential houses) under lawful ownership of organizations or individuals put into business; works in construction investment projects put into business;

3. Portions of floor area in existing works and works to be constructed in the future;

4. Rights to use land with completed technical infrastructure in real estate projects put into business;

5. Real estate projects.

What Conditions Apply Generally to Real Estate Put into Business?

In addition to falling within one of the 5 types mentioned above, all real estate and real estate projects must meet the principles provided in Article 4 of the Real Estate Business Law 2023:

"Real estate and real estate projects put into business must meet the conditions specified in this Law." (Clause 2, Article 4)

For existing residential houses and construction works, Article 14 of the Real Estate Business Law 2023 provides that specific conditions must be met before putting them into transaction. Enterprises and individuals must verify each condition according to the corresponding type of real estate to ensure lawfulness.

Under What Conditions May Rights to Use Land with Technical Infrastructure Be Put into Business?

For the fourth type of real estate — rights to use land with completed technical infrastructure in a project — the law establishes particular requirements regarding completion of infrastructure, service connectivity, and consistency with investment objectives. However, since certain provisions of related legislation have been marked as partially repealing, enterprises should consult the latest guidance documents and confirm with competent authorities before undertaking transactions of this type.

What Conditions Must Real Estate Business Enterprises Meet?

According to Article 9 of the Real Estate Business Law 2023, organizations and individuals wishing to engage in real estate business must establish an enterprise in accordance with enterprise law or a cooperative, with a real estate business line of operation. Real estate business enterprises must additionally meet the following conditions:

"Real estate business enterprises conducting business through a real estate project must have equity capital of not less than 20% of total project investment for projects with land use scale below 20 ha, not less than 15% of total project investment for projects with land use scale of 20 ha or more, and must ensure the capacity to mobilize capital to implement the investment project." (Point c, Clause 2, Article 9)

Furthermore, an enterprise must not be during a period of being prohibited from conducting real estate business or being temporarily suspended or discontinued according to judgment or decision of a competent authority; and must ensure the ratio of credit outstanding debt and corporate bond outstanding debt to equity capital in accordance with regulations.

Must Individuals Selling Real Estate on a Small Scale Establish an Enterprise?

Not necessarily in all cases. According to Clause 3 and Clause 4, Article 9 of the Real Estate Business Law 2023:

• Individuals engaging in small-scale real estate business are not required to establish an enterprise but must make tax declarations and payments in accordance with applicable law.

• Organizations and individuals selling residential houses, construction works, or portions of floor area in construction works not for business purposes or below small-scale level are not required to comply with all provisions of the Real Estate Business Law 2023, but must still make tax declarations and payments; in the case of individuals selling, buying, or renting residential houses, they must also perform notarization and authentication in accordance with this Law's provisions.

Does the Decree Guiding the Real Estate Business Law 2023 Provide Any Additional Provisions?

Decree 96/2024/ND-CP detailing certain provisions of the Real Estate Business Law provides specific guidance on certain matters related to payment methods, calculation of selling price, and leasing price of floor area in various types of works put into business. Enterprises should cross-reference this Decree when drafting real estate business contracts to ensure compliance with mandatory form and content requirements.

What Should Enterprises Pay Attention to When Putting Real Estate into Business?

Before putting a real estate project into business, enterprises must verify all conditions according to each type of real estate specified in the Real Estate Business Law 2023, including: project legal conditions, financial capacity conditions of the enterprise, and information disclosure obligations. The law requires that project information be disclosed fully, honestly, and accurately on the housing and real estate market information system, as well as on the enterprise's electronic information website. Any transaction violating the conditions specified in Articles 4 and 5 may be subject to legal sanctions.

If an enterprise or individual needs specific advice on the type of real estate intended to be put into business, applicable legal conditions, or contract drafting in accordance with regulations, A&D Law Firm — business legal counsel in Vietnam — is ready to assist from the legal review phase to transaction implementation.

This article is for informational reference purposes only and does not replace official legal advice for specific circumstances. Legal provisions may change; please contact a lawyer for advice appropriate to your actual situation.