The deposit is the first money a property buyer pays out and the easiest money to lose — because it sits at the stage where the project has nothing certain about it but promises. The Real Estate Business Law 29/2023/QH14 tightened this stage with two numbers every off-plan home buyer should know by heart: the developer may collect a deposit only when the housing is eligible to be put into business, and the deposit is capped at 5% of the sale price. Every “good-faith deposit” or “booking fee” outside that frame sits outside the zone the law protects as a deposit.
A two-layer legal frame: off-plan housing and everything else
Layer one applies to off-plan housing and construction works sold by a project developer: clause 5 of Article 23 of the 2023 Real Estate Business Law provides that the developer may collect a deposit from customers only when the housing or works are eligible to be put into business under that law; the deposit agreement must state the sale or hire-purchase price clearly; and the deposit may not exceed 5% of that price. The three conditions are a package: without business eligibility, nothing may be collected; above 5%, the deposit term exceeds the statutory frame. A lawfully collected deposit then counts toward contract payments, with the first instalment capped at 30% of the contract value including the deposit under Article 25.
Layer two is deposits in the remaining property transactions — existing homes and land between individuals, deposits for project-transfer deals, or pure civil arrangements: the Civil Code’s deposit regime in Article 328 applies, the amount is freely agreed with no statutory cap, and the default mechanism is that a depositor who refuses to conclude or perform loses the deposit, while a deposit-holder who refuses must return it plus an equivalent amount, unless otherwise agreed. The costliest buyer mistake is importing layer two’s beliefs (any deposit amount works, double penalty when the seller backs out) into layer one, or the reverse — because the two layers produce entirely different money outcomes in a dispute.
Practical risks: pre-eligibility deposits and intermediary collection
The most common risk scenario is money collected before the project is eligible for business, dressed in soft names: “good-faith deposit”, “booking fee”, a “service consultancy contract” signed with an exchange or an affiliated brokerage. The law looks at substance: customer money flowing into a project not yet permitted to sell is off-frame capital mobilisation; the developer faces administrative penalties in real-estate business and repayment obligations, while the buyer holds a document that is not a lawful deposit agreement under Article 23, with the recipient sometimes a thinly capitalised intermediary entity — recovering money when the project stalls becomes an ordinary debt lawsuit, stripped of the off-plan deposit protections.
The second scenario is stacked deposits: the same apartment taking deposits from several buyers through different sales channels, or a developer that has mortgaged the project to a bank without releasing the unit before selling. Buyers defend with checks they can run themselves: require the Department of Construction’s written confirmation of off-plan sale eligibility, check the project mortgage notices, and pay the deposit only into the developer’s own account with a reference stating the unit and the deposit agreement — never into personal accounts or a brokerage’s account without written collection authority.
When a dispute erupts: handling and protecting the deposit
Off-plan deposit disputes usually fall into one of three situations. The developer cannot sign the sale contract because the project lost eligibility or the design and price changed against the deposit agreement: the buyer may demand the deposit back and claim damages under the deposit agreement and the rules on a developer failing its sale commitments. The developer took deposits from multiple buyers for the same unit: that is deceptive business conduct, and the buyer has grounds for regulatory complaint alongside the civil claim. The buyer simply changes their mind: the deposit’s fate follows the signed deposit agreement — within the off-plan frame, a lawful deposit agreement usually specifies forfeiture cases clearly, and a buyer who withdraws without grounds will struggle to recover it.
The buyer’s deposit-protection toolkit, in order of effectiveness: deposit only after seeing the business-eligibility document; a deposit agreement stating the final sale price, the deadline for signing the sale contract, and unconditional refund events (contract not signed on time, price changed, the unit’s mortgage not released); payment by bank transfer into the developer’s account with a full reference to lock the evidence; and for large deposits, an escrow account at a bank releasing funds only when the sale contract is signed. The cost of these four layers is close to zero against the value of a deposit lost in a frozen project.
Frequently Asked Questions
1. What is the maximum deposit under the new law?
For off-plan housing and construction works: a maximum of 5% of the sale or hire-purchase price under clause 5 of Article 23 of the Real Estate Business Law 29/2023/QH14, with the deposit agreement required to state the price. For existing property and other civil transactions, the deposit is freely agreed under Article 328 of the Civil Code, with no statutory cap.
2. When may a developer collect a deposit?
Only when the housing or works are eligible to be put into business under the Real Estate Business Law — that is, the project holds the legal documents and the competent authority’s confirmation of off-plan sale eligibility. Collecting money as a “good-faith deposit” or “booking fee” before that point is off-frame capital mobilisation, subject to penalties and repayment.
3. How are deposit disputes resolved?
By the deposit agreement and the applicable layer: off-plan deposit disputes run under the deposit agreement within the Article 23 frame and the developer’s liability rules; civil deposits follow Article 328 of the Civil Code — a withdrawing depositor forfeits, a withdrawing deposit-holder returns the deposit plus an equivalent amount, unless otherwise agreed. Resolution runs negotiation, mediation, then the court where the property sits or as agreed; multiple deposits on one unit with signs of deception also support a regulatory complaint.
4. How does a buyer protect the deposit?
Four layers: verify the project’s sale-eligibility confirmation before depositing; a deposit agreement stating the final price, the sale-contract signing deadline and unconditional refund events; payment by bank transfer into the developer’s own account with the unit clearly referenced; and for large deposits, a bank escrow account that releases only when the sale contract is signed.
This article has been quality-reviewed by the FLAW AI Legal Council