Short answer: Vietnamese citizens can freely buy residential property in the United States — there is no federal ban on foreign buyers. The real traps come later: a 15% FIRPTA withholding on the gross sale price when you sell, US estate tax with only a USD 60,000 exemption for nonresident aliens, and Vietnam’s foreign-exchange controls on moving the purchase money out.
Buying: what the law allows
US federal law does not prohibit foreign nationals from purchasing residential real estate. A Vietnamese buyer goes through the same closing process as an American: offer, inspection, title search, title insurance, and recording. Practical notes: you will need a US tax identification number (ITIN) for tax filings; mortgage financing is available but foreign buyers face higher down payments and rates; and some states restrict foreign ownership of agricultural land or land near military installations — a house in a suburb is unaffected, a ranch is not.
Selling: FIRPTA — the 15% that surprises everyone
The Foreign Investment in Real Property Tax Act (FIRPTA, IRC §1445) requires the buyer to withhold tax when purchasing US real property from a foreign person. The standard rate is 15% of the gross sales price — not the gain — in effect for closings since February 2016. Two reduced rates apply only when the buyer will use the property as a residence: 10% for prices between USD 300,001 and 1,000,000, and no withholding at or below USD 300,000. The buyer is personally liable for the withholding, so closings routinely include a non-foreign affidavit. Sellers who expect a smaller actual tax bill can apply to the IRS for a withholding certificate (Form 8288-B) to reduce the amount — but it must be approved before closing.
Holding: estate tax and rental income
US estate tax hits nonresident aliens hard: the exemption is only USD 60,000 (versus millions for US persons), with rates up to 40% on US-situs assets including real estate. Holding through a properly structured entity is the standard planning response — get cross-border advice before buying, not after. Rental income is subject to 30% withholding on the gross amount unless the owner elects to be taxed on net rental income as effectively connected income. Annual property taxes and HOA dues apply like any owner.
Moving the money out of Vietnam
Vietnam maintains foreign-exchange controls: money cannot leave freely. Outward transfers must go through an authorized bank with a proven lawful purpose and documented source of funds (Ordinance on Foreign Exchange, Decree 70/2014/ND-CP, Circular 20/2022/TT-NHNN). Buying a US home as an investment falls under outward-investment rules — requiring an outward investment registration certificate under the Investment Law 143/2025/QH15 and a dedicated capital account. Buying in connection with settlement follows the settlement-transfer channel with proof of lawful assets after Vietnamese tax obligations. Using informal channels risks the funds and the transaction itself. Plan the transfer route before signing the US purchase contract.
Checklist
- Obtain an ITIN early; line up financing or proof of funds before making offers.
- Buy title insurance — the US system relies on it, not on a state-guaranteed title.
- Model FIRPTA on exit: the 15% is withheld on price, refundable only via a US tax return.
- Get estate-tax structuring advice before taking title in your own name.
- Choose the lawful forex channel (investment vs. settlement) and prepare source-of-funds documents before moving money.
Frequently asked questions
Can a Vietnamese citizen buy a house in the US without a green card?
Yes. Immigration status is irrelevant to the purchase — ownership and visas are separate matters. Owning a house gives no immigration benefit.
Is the 15% FIRPTA withholding the final tax?
No — it is a prepayment. File a US tax return reporting the actual gain; if the withholding exceeds the real tax, you claim a refund. Many sellers are surprised by the cash-flow timing.
What if we buy the house through a company?
A foreign corporation is also a “foreign person” under FIRPTA, so the withholding still applies on sale. Entity choice is driven mainly by estate-tax and liability planning — model it with advisers in both countries.
Can we simply carry cash to pay?
No. Large cash transactions trigger reporting, and moving funds out of Vietnam requires the banking channel with documented purpose and source. Informal transfers jeopardize both the money and the deal.
Does the US–Vietnam tax treaty help?
The treaty does not override FIRPTA on real-property gains — the US retains the right to tax them. Treaty relief matters more for other income types.
Buying a home in the US from Vietnam? FLAT Law Firm coordinates the Vietnamese-side forex and structuring work — contact us before you wire the deposit.
This article has been quality-reviewed by the FLAW AI Legal Council