Vietnam's housing market remains a magnet for foreign capital, but it is also one of the most tightly regulated sectors: developer conditions, land regime, capital mobilisation and sale conditions each carry their own legal "fences". Unlike domestic investors, foreign investors face an extra layer of conditions on land access and subject qualification.
This handbook systematises the full legal framework a foreign investor needs when implementing a commercial housing project in Vietnam: conditions, step-by-step procedures, special risks and a compliance checklist — centred on the 2023 Housing Law, the 2023 Law on Real Estate Business, the 2024 Land Law and the 2025 Investment Law.
Contents
- 1. Overview and governing legal framework
- 2. Conditions to act as a commercial housing project developer
- 3. Setting up and operating the project company
- 4. Key project procedures
- 5. Special legal risks foreign investors often hit
- 6. Periodic compliance checklist
- 7. Notable legal changes
- 8. Frequently asked questions
- 9. Related articles in this handbook
- Need legal accompaniment for your housing project?
- References
1. Overview and Governing Legal Framework
Commercial housing project investment in Vietnam is governed simultaneously by four pillar laws and their guiding documents:
- The 2023 Housing Law (27/2023/QH15, effective 01/8/2024): project developers, developer rights and obligations, forms of foreign housing ownership.
- The 2023 Law on Real Estate Business (29/2023/QH15, effective 01/8/2024, some provisions from 01/01/2025): business conditions, conditions for marketable real estate, capital mobilisation, project transfer.
- The 2024 Land Law (31/2024/QH15, effective 01/8/2024): land-use regime, especially land lease for foreign-invested economic organisations.
- The 2025 Investment Law (143/2025/QH15, effective 01/3/2026): investment policy approval and investment registration certificates for foreign-invested projects.
Regulators per area: the Ministry of Construction and Departments of Construction (housing, real estate business, construction permits); the Ministry of Finance and investment registration agencies (investment); the Ministry of Agriculture and Environment with local natural-resources agencies (land, after the apparatus rearrangement).
The core difference for foreign versus domestic investors lies in two places: subject qualification (must establish an economic organisation in Vietnam meeting real estate business conditions) and land regime (land lease only, no allocation with land-use fees). These two shape the project's entire legal and financial structure.
2. Conditions to Act as a Commercial Housing Project Developer
Article 35 of the 2023 Housing Law defines residential construction project developers to include enterprises and cooperatives — including foreign-invested economic organisations established and operating under Vietnamese law with a real estate business function. A foreign investor therefore does not act as developer directly as a foreign legal person, but through a Vietnamese legal entity it owns or co-owns.
Article 35(2) sets three mandatory conditions for a developer that is a real estate business enterprise:
One, owner's equity per real estate business law. The 2023 Law on Real Estate Business requires a real estate business enterprise to have charter capital of no less than VND 20 billion. Additionally, for each specific project, the developer must meet owner-equity requirements proportionate to the project scale. This is the first "entry ticket" and the basis for regulators to assess financial capacity.
Two, land-use rights for the project. The developer must hold land-use rights suited to the project type under the 2023 Housing Law, or be allocated or leased land under the 2024 Land Law. For foreign-invested economic organisations, land access is via land lease (see section 4.2).
Three, capacity and experience. The developer must demonstrate capacity and experience in implementing residential construction projects — covering the legal entity and key personnel. For foreign investors new to Vietnam, overseas project experience may be considered, but must be fully documented in the dossier.
Once qualified and approved as developer, the enterprise enjoys the Article 38 rights of the 2023 Housing Law: selling, hire-purchasing and leasing housing; mobilising capital and collecting money as prescribed; exercising land-user rights; transferring part or all of the project; managing and operating technical and social infrastructure within the project.
3. Setting Up and Operating the Project Company
The foreign investor's first step is establishing an economic organisation in Vietnam — typically a 100% foreign-owned LLC or a joint venture with a Vietnamese partner. Specific notes for this model:
Real estate business lines must be fully registered in the enterprise registration certificate, including real estate business and land-use rights owned, used or leased. Without suitable business lines, the enterprise lacks standing to sign real estate sale or lease contracts.
Minimum VND 20 billion charter capital under the 2023 Law on Real Estate Business must be fully contributed and maintained throughout operations. Dropping below this level means losing real estate business eligibility.
Investment policy approval and IRC. Foreign-invested housing construction projects require investment policy approval and an investment registration certificate under the 2025 Investment Law. This runs parallel to being selected as the housing project developer — two procedures under two different legal systems (investment and housing) that interlock closely.
Periodic compliance duties after going live: periodic investment-activity reports to the investment registration agency; financial statements and tax duties; project implementation reports to the housing authority; project and progress disclosures under real estate business rules.
4. Key Project Procedures
4.1 Investment Policy Approval and the Investment Registration Certificate
Foreign-invested commercial housing projects must undergo investment policy approval under the 2025 Investment Law. The dossier includes the application, the project proposal (objectives, scale, capital, timeline), financial-capacity evidence, and project-location documents. Approval authority depends on project scale and nature: the Prime Minister, the provincial People's Committee, or the economic/industrial zone management board under decentralisation.
After policy approval, the investor obtains the investment registration certificate (IRC) from the investment registration agency. The IRC is the legal basis for the next land and construction steps.
4.2 Land: Leasing Land for the Project
This is where foreign and domestic investors differ most. Under the 2024 Land Law, foreign-invested economic organisations are leased land by the State for project implementation, in two forms: lump-sum rental for the whole lease term or annual rental.
The lease form directly affects the financial model: lump-sum rental allows capitalising land rent into costs and offers more flexibility in capital mobilisation and mortgaging; annual rental eases initial capital pressure but limits certain rights. Investors should model both options before deciding.
The land lease term follows the investment project's term, up to 50 years, extendable as prescribed. The lease procedure includes: the competent authority's land-lease decision, signing the land-lease contract, paying land rent, and issuance of the land-use-right certificate (for lump-sum rental).
4.3 Construction Permits, Execution and Acceptance
With land in hand, the developer handles construction procedures: design appraisal, construction permitting (except exempt cases), execution per the approved design, and acceptance for putting the works into use. For commercial housing projects, foundation acceptance is especially significant — it is one of the conditions for selling off-plan housing.
4.4 Conditions for Off-Plan Sales and Payment
Selling off-plan housing is the project's main capital-mobilisation channel, but allowed only when fully meeting the 2023 Law on Real Estate Business conditions: land-use-right documents; a construction permit; completed foundations; and the provincial housing authority's written notice that the housing is eligible for sale.
On payment, the law is strict and phased: payments in multiple instalments, the first no more than 30% of the contract value (including the deposit); subsequent instalments aligned with construction progress, but total payment before handover no more than 70% of the contract value; the remaining minimum 5% of the contract value collectible only when the buyer is issued the land-use-right and housing-ownership certificate. This protects buyers and forces developers to complete their legal duties to the end.
5. Special Legal Risks Foreign Investors Often Hit
Risk 1: Lacking developer qualification from the start. Some foreign investors sign investment cooperation agreements or "acquire projects" while their Vietnamese entity does not yet meet the three Article 35 conditions of the 2023 Housing Law. Consequence: not recognised as developer, and all subsequent sales are unlawful.
Risk 2: Disguised capital mobilisation before sale eligibility. "Goodwill deposits", "priority reservations", "capital-contribution investment cooperation" to collect customer money before meeting off-plan sale conditions are all serious administrative violations. Where misappropriation is indicated, managers may face criminal liability.
Risk 3: Land-lease structure mismatched to the financial model. Choosing annual rental to ease initial capital, only to discover the land-use right cannot be mortgaged for bank loans as expected, or that annual rent erodes project cash flow.
Risk 4: Selling to foreign buyers beyond the quota. Well-located projects attract many foreign buyers, but each condo tower may sell at most 30% of its apartments to foreigners. Exceeding the quota means buyers cannot get ownership certificates — disputes and refund claims are inevitable.
Risk 5: Improper project transfer. Acquiring a stalled project from the old developer without properly completing the real estate project transfer procedure (transferor conditions, transferee conditions, competent-authority approval) leaves the buyer without lawful developer standing.
Risk 6: Policy risk for the foreign-buyer segment. The draft 2026 Housing Law amendment proposes narrowing foreign housing ownership (expected to leave only condo apartments). Projects whose sales plans depend heavily on foreign buyers of villas and townhouses should scenario-plan for this.
Risk 7: Buyer disputes over progress and quality. Late handover, area discrepancies, amenities not matching advertising are the three most common dispute groups. Sale contracts need tight drafting, and all marketing commitments must align with the project's legal dossier.
6. Periodic Compliance Checklist
Before opening sales:
- Developer conditions met (capital, land, capacity) with approval documents
- IRC and investment policy approval still valid
- Land procedures completed; construction permit in hand
- Foundations completed with the Department of Construction's sale-eligibility notice
- Model sale contract registered/approved as prescribed
During sales and construction:
- Collect money at statutory ratios (30%/70%/5%); no disguised capital mobilisation
- Maintain the payment-guarantee arrangements required for off-plan sales; keep buyer funds in designated accounts until handover conditions are met
- Track the foreign quota per tower (max 30% to foreigners)
- Report project progress periodically to regulators
- Perform tax duties fully (VAT, CIT, land rent)
After handover:
- Complete acceptance; hand over on the committed schedule
- Support buyers with ownership-certificate procedures
- Hand over the maintenance fund; establish the condo management board as prescribed
- Settle financial obligations with the State
7. Notable Legal Changes
The 2025 Investment Law (143/2025/QH15, effective 01/3/2026) replaces the 2020 Investment Law, reshaping all investment policy approval and IRC procedures. Ongoing projects should review for alignment with the new framework.
The draft 2026 Housing Law amendment being finalised by the Ministry of Construction, with the most notable proposal being to narrow foreign housing ownership (expected to leave only condo apartments, removing separate-house ownership). Still a draft, but investors with foreign-buyer sales plans should monitor closely and build response scenarios.
The 2024 Land Law and the 2023 Law on Real Estate Business have been effective since 01/8/2024, creating the new framework for land access and business conditions. Projects approved before then should check applicable transitional provisions.
Land pricing and land rent. Under the 2024 Land Law's land-price framework, land rent and land-use levy calculations have shifted toward market-based price tables updated annually. Foreign-invested developers should model land financial obligations under the new price tables early, because land costs can materially change project feasibility compared with older approved estimates. Early proactive engagement with the provincial land-price appraisal council helps avoid surprises at the land-rent notification stage.
8. Frequently Asked Questions
Can foreign investors act as developers of commercial housing projects in Vietnam? Yes, through a foreign-invested economic organisation established and operating under Vietnamese law, with a real estate business function and meeting all three Article 35(2) conditions of the 2023 Housing Law: owner's equity, land-use rights, capacity and experience.
What is the minimum charter capital for real estate business? No less than VND 20 billion under the 2023 Law on Real Estate Business. Additionally, each project requires owner equity proportionate to its scale.
Do foreign investors get land allocated or leased for housing projects? Leased by the State (lump-sum or annual rental), not allocated with land-use fees. The lease form directly affects the financial structure and capital mobilisation plan.
When may off-plan housing be sold? When there are land-use-right documents, a construction permit, completed foundations, and the provincial housing authority's sale-eligibility notice. Phased payment: first instalment no more than 30%, total no more than 70% before handover, at least 5% retained until the certificate is issued.
Can capital be raised from customers before sale eligibility? No. All money collection as deposits, reservations, capital contributions or investment cooperation for priority purchase before meeting sale conditions violates the law.
Can an ongoing project be transferred to another investor? Yes, if meeting project-transfer conditions: the transferor's project legality, the transferee's developer qualification, and competent-authority approval.
9. Related Articles in This Handbook
- How Many Apartments Can Foreigners Own in Vietnam? — the 30% cap, conditions, ownership term (T-435)
- Foreigners Buying Residential Housing in Vietnam: Conditions and Caps — a detailed buyer guide (T-416)
Need Legal Accompaniment for Your Housing Project?
From entity structuring, investment procedures and land to sales opening and handover, every decision in a commercial housing project's life cycle needs a solid legal foundation. FLAT Law Firm accompanies foreign investors throughout: project legal due diligence, transaction structuring, investment approvals, and compliance advice during implementation. Contact hotline 0988424851 to discuss your project.
References
- Housing Law No. 27/2023/QH15, effective 01/8/2024.
- Law on Real Estate Business No. 29/2023/QH15, effective 01/8/2024.
- Investment Law No. 143/2025/QH15, effective 01/3/2026.
- Land Law No. 31/2024/QH15, effective 01/8/2024.
