HCMC – The Ministry of Construction has expressed concerns that new land price lists, which will be introduced under the 2024 Land Law, may lead to housing development costs soaring.
Under the 2024 Land Law, the old land price lists will be replaced with the land price lists that are annually adjusted based on market factors such as land use and duration.
In a letter to the Government Office, the ministry warned that the new pricing system will raise land-use fees, which currently account for 7-25% of housing project costs, likely leading to higher housing prices, especially for high-end developments.
The ministry provided an example from GP Invest, where land costs previously comprised 42% of the selling price per square meter, or VND15 million. Under the new pricing system, this figure could jump to 60%, or VND22 million per square meter.
Real estate prices could rise by an estimated 15-20%, the ministry cautioned. It urged the Ministry of Natural Resources and Environment to oversee the way local governments make new land price lists to prevent excessive hikes.
