In its Q2/2025 report on housing and the real estate market, MOC proposed several key measures to better control the real estate market, including real estate taxation. It has urged relevant ministries and branches to build a shared database on real estate transactions, notarizations, taxation and land transaction registrations. 

Regarding the new Personal Income Tax Law draft, the Ministry of Finance (MOF) proposed that personal income tax on real estate transfers by resident individuals be calculated as taxable income multiplied by a 20 percent tax rate per transaction.

Taxable income is determined by the selling price minus the purchase price and reasonable expenses incurred in the process of transferring real estate. If the purchase price and related expenses cannot be determined, personal income tax would be calculated as the selling price multiplied by the tax rates.

For real estate held for less than 2 years, the tax rate would be 10 percent; for 2 to under 5 years, 6 percent; for 5 to under 10 years, 4 percent; and for 10 years or more, or real estate from inheritance, 2 percent.

The holding period is calculated from the date an individual gains ownership or use rights of the real estate, starting from the effective date of the PIT Law (replacement), until the transfer date.

Some real estate experts believe that taxing to limit speculation, ‘surfing’ investment, and price inflation is appropriate, but requires clear implementation methods.

Regulations should specify the taxation objectives to avoid vague application to unintended groups, creating difficulties for those forced to sell due to financial reasons. Therefore, data is needed to distinguish taxable entities.

Price manipulation

In the report, MOC also proposed that the Ministry of Agriculture and Environment (MAE) review Land Law regulations to report to the Government and PM for amendments to meet practical needs, resolve issues in land use fee valuation, and address manipulation, price inflation, and interventions in land use rights auctions.

Additionally, MAE should guide and collaborate with local People’s Committees to strengthen inspections, audits, land price determination, issuance of land price lists, compensation, site clearance, and land auctions.

For local People’s Committees, MOC proposed increased inspections to promptly prevent and strictly handle violations by enterprises, investors, real estate exchanges, real estate brokerage service businesses, and land-use rights auctions.

Localities should focus on the legality and transparency of real estate brought to market with unusual price increases, preventing profiteering and market disruptions.

MOC is finalizing a pilot project for a “State-managed Real Estate and Land Use Rights Transaction Center,” to be submitted to the Government for consideration and approval.

What will happen?

Nearly a decade ago, when a real estate project in HCM City was launched, buyers from Hanoi and Hai Phong flew to HCM City to purchase landed properties, targeting units in prime locations with values up to VND30 billion. Some even bought multiple adjacent units to combine into a larger home.

In contrast, at the same project, others sought apartments or less prime landed properties, focusing on project legality and bank loan interest rates.

Ha Vinh, a real estate sales agent at the project, said this project highlights the diverse profiles of property owners.

“We met speculators, homebuyers, and small-scale investors. Different needs lead to different consumer behaviors,” she said. 

According to Vinh, the draft PIT Law being reviewed by MOF would help curb real estate speculation, but it may inadvertently affect investors.

Investment involves using savings to buy assets expecting value appreciation, which are sold when profitable. 

Vinh gave an example of a young couple buying a small apartment to live in, wanting to sell when the prices go up high enough to bring profit. They cannot wait until they can satisfy the requirements on homeownership period to enjoy lower tax rates on transfers.

Thus, taxing based on holding periods may discourage investment. With a 10 percent tax on the total selling price for properties held under 2 years, investors may see no profit.

Vinh also noted that speculators with strong financial capacity can hold properties long-term, so the proposed tax rates may not significantly impact their cash flow or profits. However, the tax could affect those with limited funds looking to invest. Distinguishing between these groups is challenging.

Manh Ha