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Authorities to Remove the Legal Obstacles to Renovate Old Apartment in 2021

At present, in urban areas across Vietnam, there are about 2,500 old apartment blocks (equivalent to more than 3 million sqm of floor) built before 1994, according to the data from the Ministry of Construction.

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After checking and testing the bearing safety of old condominiums, there are currently over 600 badly damaged apartment buildings (grade C, grade D quality - which are dangerous levels), accounting for 25% of the total. In large cities like Hanoi, HCMC and Hai Phong City, there are more than 100 apartment buildings this type.

Legal Obstacles

Experts from Housing and Real Estate Market Management Department and HoREA said the re-planning of old condominiums faces many difficulties such as:

- Complex ownership rights (individual, collective, and state ownership are mixed together)

- The difficulties in the selection of project investors and the resettlement policy

- The conundrum relating to the exemption of land use fees, land rent, land use purpose change.

- Refusal to leave level D apartments despite government danger warnings (many households disagreed with level D result and refuse to leave unless a ‘return date’ is provided)

Solving problems from the mechanism

Leaders of the Ministry of Construction said that they are urgently collecting comments to improve and submit to the Prime Minister for the approval of changing Decree 101/2015/ ND-CP on policies related to renovation and general reconstruction residential, old dormitory.

The most crucial issue that needs to be changed is the impractical, unfeasible conditions in Clause 3, Article 110 of the 2014 Law on Housing, requiring that all (100%) owners agree to demolish the apartment building to rebuild new condominiums (except level D for unsuitable living conditions). HoREA analyzed that it is more reasonable to reach at least 75% (equal to 3/4) of owners agree to demolish the apartment building to rebuild a new apartment building.

HoREA also suggest that the changes should be focus on:

  • Regulations of the Law on Housing on condominium dismantlement, especially in cases of emergency dismantlement (for apartment buildings at dangerous levels) for local unanimous implementation

  • Along with the bottlenecks related to policies such as planning, construction, taxes, land etc., the regulations on resettlement arrangement should also be adjusted accordingly

Difficulties and problems related to some decrees regarding the renovation and reconstruction of old apartment buildings and dormitories have been discussed frequently in recent years but haven't reached a proper conclusion. At present, the Ministry of Construction is studying and absorbing ideas to propose the most appropriate mechanisms and policies, in accordance with the actual conditions to solve the problem.

“As the root of the current problem is legal, the Ministry of Construction will try to build a basic legal corridor in 2021, then if necessary, it will continue to amend to comply with the legal process." said Deputy Minister of Construction Le Quang Hung.

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