Vietnam to Set Apartment Building Lifespans Based on Construction Duration

The Vietnamese government has agreed to set the lifespan of apartment buildings based on their construction duration. This measure aims to align the lifespan with the building's service life and ensure consistency. In a resolution from a government meeting on legal system development held on September 18, the government instructed the Ministry of Construction to clearly stipulate this content in the draft Law on Housing (amended). It also requires specific regulations for handling apartment buildings that have exceeded their lifespan, clarifying the rights and obligations of apartment owners. This includes the right to continue using land use rights for reconstruction and the obligation to fulfill financial duties for new construction upon expiration of the lifespan. The Ministry of Construction will design a framework of criteria based on urban type, population density, and area ratio, which will serve as a basis for provinces and cities to make specific decisions. This aims to limit land subdivision and sale, ensuring "measures to prevent policy-driven speculation to the maximum extent." Furthermore, the Ministry of Construction will complete regulations on rental housing, clarifying the models of ownership, management, and operation for different types of rental housing, commercial housing, public housing, and policy housing. The government noted the need to incorporate financial mechanisms such as taxes, fees, land use fees, and credit to control and manage rental housing prices. Criteria, subjects, and scope for preferential treatment for rental housing will also be clarified, and procedures for accessing rental housing will be simplified to meet the people's need for stable and long-term accommodation. Principles, criteria, and limits for obligations related to rental housing in commercial housing projects will also be stipulated, providing a legal basis for provinces and cities to decide. The government plans to propose to the National Assembly a pilot mechanism for the state to buy back commercial housing projects from developers who are unable to implement or transfer them. Prior to this, Resolution 21 of the Central Committee stipulated that new apartment buildings would have a lifespan based on their construction duration, and the property rights of owners would be guaranteed. When a building reaches the end of its lifespan, apartment owners can fulfill their financial obligations for reconstruction according to regulations. In the draft Law on Housing discussed in the National Assembly in August, a definition of "limited-life apartment buildings" was proposed. However, many delegates expressed concern that this concept could lead people to misunderstand that they would lose their apartment ownership after 50 or 70 years. This concept might confuse the lifespan of the building with apartment ownership. Subsequently, the Ministry of Construction removed the concept of "limited-life apartment buildings" from the latest draft Law on Housing (amended) to avoid misunderstandings about people's apartment ownership. In the new draft, the Ministry of Construction has also amended and completed the content on renovation and reconstruction of apartment buildings. The agency proposes determining the lifespan based on the building's design documents, a departure from the August draft's approach combining design documents and actual inspection. The Ministry stated that owners have the right to continue using the land area to rebuild the building themselves, but the renovation must be implemented as a project. Enterprises undertaking apartment renovation and reconstruction projects may receive additional incentives, such as exemption from social housing and rental housing obligations.