In the draft amended Housing Law, the Ministry of Construction proposes terminating ownership rights to apartments and other areas when condominium buildings reach the end of their lifespan and are demolished.
The draft amended Housing Law, drafted by the Ministry of Construction, has just been published by the Ministry of Justice for appraisal. One of the notable changes is the regulation on establishing and terminating ownership rights of condominium apartments.
Accordingly, the draft stipulates that the term of apartment ownership is determined by the building’s lifespan. Provincial-level People’s Committees will inspect and assess the quality of condominiums when the building expires or before expiration if it is damaged, at risk of collapse, or unsafe for users.
If the usage term is not extended, the condominium must be demolished. Ownership rights to the apartments and other areas in the condominium will terminate after the demolition process. In this case, apartment owners have the right to continue using the land area to self-renovate or rebuild the condominium by contributing funds. The contribution is calculated as: The ratio of apartment usage area (x) the investment rate for building 1 square meter of new housing floor space at the time of demolition.
If they do not wish to contribute funds for rebuilding, the owners will hand over the land to the State to assign to a developer to implement the reconstruction project. They will be compensated for the value of the land use rights of the condominium based on the ratio of common use area.
The 2023 Housing Law currently does not regulate apartment ownership terms, but only stipulates the lifespan of condominium buildings based on design documents and actual quality inspections.
In reality, the Certificate of Land Use Rights, Ownership of Houses and Other Assets Attached to Land specifies two types of apartment usage terms: long-term and limited-term. Among them, long-term apartments are built on residential land, allowing buyers to own the apartment attached to stable, long-term land use rights. Meanwhile, 50-to-70-year apartments are mainly built on land with a limited usage term, such as commercial or service land. When purchasing this type, buyers can use it for the remaining period of the project, starting from the date the State hands over the land to the developer.
According to the drafting agency, condominiums are a type of construction with a limited lifespan because they will deteriorate and degrade over time. Adding regulations on condominium ownership rights helps gradually change public perception regarding these assets being “long-term” or “permanent.”
The old apartment block at 135 Nguyen Van Cu Street, Long Bien, was built between 1988 and 1990. Photo: Ngoc Thanh
The old apartment block at 135 Nguyen Van Cu Street, Long Bien, was built between 1988 and 1990. Photo: Ngoc Thanh
In the case of renovation and reconstruction, the Ministry of Construction proposes determining the lifespan of the condominium based on the approved design documents, calculated from the time the entire building is handed over and put into use. When appraising design documents, competent authorities must clearly specify the lifespan of the condominium.
The draft also adds regulations on cases where condominiums must be demolished. In addition to the expiration of the usage term, buildings that are severely damaged by fires, natural disasters, seriously degraded, at risk of collapse, or no longer meet safety conditions are subject to demolition.
To protect the rights of residents, the Ministry of Construction proposes an on-site resettlement mechanism for land areas approved for rebuilding condominiums. If the planning is not approved, apartment owners will be compensated in cash or arranged for resettlement in the same ward, commune, or neighboring areas.
According to Circular 05/2022 on National Technical Regulations on construction classification and grading, the lifespan of a building will be determined based on four levels. After the usage term expires, functional agencies will re-inspect the quality and extend it if safety is guaranteed.
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