Placing a deposit on an off-plan apartment (a unit that does not yet exist) is the first step in a high-value property transaction — and the riskiest: the buyer pays while the unit is still on paper, and the developer may not yet be eligible to sell. The 2023 Real Estate Business Law (29/2023/QH15, effective 01/8/2024) tightened the rules on deposits and payments. Here are seven points no buyer should miss.
1. Deposit Capped at 5% of the Sale Price — Only When Eligible to Sell
Article 23.5 of the Real Estate Business Law provides: a project developer may collect a deposit of no more than 5% of the sale price of off-plan houses or construction works only when all conditions for putting them on the market are met; the deposit agreement must state the sale price clearly.
- Any collection labeled “reservation fee”, “good-faith money” or “priority selection fee” that exceeds 5% or is collected before the project is eligible violates this rule;
- The deposit agreement must state the sale price — without a specific price, the 5% cannot be determined and the buyer may refuse to sign;
- Keep all transfer receipts, noting “deposit for apartment [unit code]”.
2. Verify the Project’s Eligibility to Sell Off-Plan Units
Before paying a deposit, ask the developer to produce documents proving eligibility under Article 24 of the Real Estate Business Law: land use rights, planning approvals, construction permit (where required), approved project dossier, and the provincial housing authority’s written confirmation that the units are eligible for sale. Collecting deposits for an ineligible project is a violation — the buyer has grounds to demand a refund and compensation.
3. Payment Schedule: The Hard Caps of Article 25
Article 25 sets payment limits the developer may not exceed:
- First installment: no more than 30% of the contract value, including the deposit;
- Total paid before handover: no more than 70% of the contract value;
- Before issuance of the ownership certificate (pink book): total payments no more than 95%; the remaining 5% is paid only after the certificate is issued.
Cross-check the sale contract’s payment schedule against these caps — any installment exceeding them is grounds to refuse payment and demand adjustment.
4. Two-Way Deposit Penalty Under Article 328 of the Civil Code
Deposit agreements are subject to Article 328 of the 2015 Civil Code:
- Buyer (depositor) refuses to conclude/perform the contract → forfeits the deposit;
- Developer (deposit-taker) refuses to conclude/perform → must refund the deposit plus an equal amount, unless otherwise agreed.
State clearly: the deposit period, the deadline for signing the sale contract, and how the deposit is handled if the project cannot proceed (not the buyer’s fault) — in that case, agree on a full refund rather than applying the penalty.
5. Bank Guarantee for the Developer’s Obligations
The Real Estate Business Law requires developers of off-plan housing projects to have a bank guarantee their financial obligations to buyers before selling. Buyers should:
- Request the guarantee letter / guarantee contract from the commercial bank covering the project;
- Verify the guarantee’s scope: refund of advance payments if the developer fails to hand over as committed;
- Note: a guarantee is only valid if properly issued by a licensed credit institution.
No bank guarantee is a red flag — think twice before paying.
6. Handover Deadline and Late-Handover Remedies
The sale contract must state a specific handover date (quarter/year, not a vague “expected” date). Provide for:
- Late-handover penalties: per day/month of delay, calculated on the contract value;
- Buyer’s right to unilaterally terminate if delay exceeds a set period (e.g., 90–180 days), with full refund of amounts paid plus interest;
- Definition of “handover”: actual handover of a unit eligible for use (with completion acceptance records), not merely shell handover.
7. The Pink Book: Commit to a Certificate Issuance Timeline
The 95% pre-certificate cap (Article 25) protects buyers, but buyers still need:
- A clause committing the developer to a timeline for completing certificate issuance procedures after handover;
- Remedies if the developer delays the pink book: penalties, compensation;
- The remaining 5% is paid only after the certificate is issued — the buyer’s strongest leverage; never pay 100% before holding the pink book.
Frequently Asked Questions
What is the maximum deposit for an off-plan apartment?
No more than 5% of the sale price, only when the project is eligible for sale; the agreement must state the sale price (Art. 23.5).
What is the maximum first payment?
No more than 30% of the contract value, including the deposit (Article 25).
What if the developer never hands over the unit?
Deposit penalties apply (Art. 328 Civil Code) plus late-handover penalties in the sale contract; the bank guarantee can also be triggered for a refund.
Should I pay 100% before receiving the pink book?
No. Article 25 caps total pre-certificate payments at 95%; the remaining 5% is leverage to ensure the developer completes the issuance.
Legal Basis
- 2023 Real Estate Business Law 29/2023/QH15 (effective 01/8/2024): Art. 23.5 (5% deposit cap), Art. 24 (sale eligibility), Art. 25 (payment schedule).
- 2015 Civil Code 91/2015/QH13: Article 328 (deposit, two-way penalty).
About to place a deposit on an off-plan apartment and need the deposit agreement and payment schedule reviewed before signing? Contact FLAT Law Firm via the Contact page.
The information above is for reference only and does not constitute legal advice.
Transparency note: This article was drafted by FLAT Law Firm’s AI content production system and reviewed by the internal review board (AI Legal Council QA). It has not been reviewed by a human lawyer.