During a National Assembly discussion on August 19 about changes to the 2024 Land Law, the 2023 Housing Law and the Real Estate Business Law, Hung said land prices are a basic input for building projects – and when that input is costly, the price is passed on to buyers.

“Land prices are an input for every project and for the economy,” the prime minister said.

When land costs are high, developers have to take those costs. They may also need to borrow money for projects, and getting land and approvals can take a long time.

All these costs add up and push up the final price of a house. That is why home prices are high, he explained.

Hung added that the money the state collects from land sales ends up in the selling price, together with financing and other project costs.

For that reason, he said, controlling housing prices needs a coordinated solution, not just fixing one cost alone.

State role in controlling land costs

The government plans a big change to Vietnam’s land‑pricing system as part of the Land Law amendments.

The new policy says the state will set land prices using data and scientific methods, and it must be open and transparent.

Land databases will be linked with other sector databases, and rules will be added to stop price manipulation and fake land values.

Hung said state management is needed to keep land‑related input costs low.

“The state must control land prices and manage them to keep input costs down,” he said.

But just changing the pricing method will not be enough.

Hung said it must be paired with simpler admin steps, clear ways to give land to investors, and faster approval processes.

“With coordinated solutions, we can lower input costs and keep home and land prices down,” he said.

The prime minister said all costs should be clearly calculated and dealt with through specific rules in laws or regulations.

Years of procedures ultimately add to home prices

Administrative delays were another factor Hung highlighted.

Land allocation, compensation and other steps can take years for some projects. During that time, investors keep paying costs, including loan interest.

Those costs do not disappear.

“Every time land allocation and procedures drag on for years – even before other issues appear – all those investment costs end up in prices,” Hung said.

The government wants admin reform, digital change and more local power as key parts of the new land framework.

The proposals include finishing Vietnam’s national land database, simplifying admin steps and strengthening local authority duties while keeping central oversight.

Tackling speculation and artificial land prices

The government’s plans also go beyond the immediate cost of building houses.

Future reforms will add financial tools to push land into productive use and discourage speculation or keeping land idle.

The new land‑pricing system also aims to stop manipulation and fake prices while letting the state guide land‑value growth.

The government is looking at land‑use fees and land rents for production, business and rental housing projects.

It also considers tax and land incentives for eligible groups, such as low‑income families and people who own only one home.

The National Assembly’s Economic and Financial Committee has asked for a clear, workable system for land price tables, adjustment factors and ratios.

It said these tools should be able to move up or down according to social‑economic needs at different times.

The committee also suggested separating the land‑price system from those used for compensation, assistance and resettlement.

Making land available more quickly

Another reform part aims to simplify Vietnam’s land‑use planning system.

The government wants to cut overlapping plans and move to a more integrated system, eventually having one planning framework per administrative area.

Hung said Vietnam now has national master plans, urban and rural plans, sector plans and other plans under different authorities.

The goal is to combine these as much as possible, making it easier for local governments to act.

At the same time, he warned strict rules and oversight are needed to stop random changes to land‑use plans or land purpose changes.

The government also wants clearer rules for land allocation, leasing and changes in land‑use purposes.

The principle, Hung said, should be openness, transparency and competition, giving land to investors who have enough capacity and solid plans to use it well.

Laws would more clearly set when land‑use rights must be auctioned, when projects need competitive bidding and when direct land allocation is allowed.

From compensation to rebuilding people’s lives

Minister of Agriculture and Environment Trinh Viet Hung shows the government’s policy directions for the 2024 Land Law amendments. Photo: National Assembly

The reforms also suggest a new way of thinking about what happens when the state takes back land.

Instead of mainly “compensating for recovered assets,” Hung said the system should shift to “rebuilding people’s lives when the state recovers land.”

The goal is not just to pay affected residents but to improve their living conditions.

The government proposes giving priority to residential land or housing at the same site for people whose land is taken back.

At the same time, the Economic and Financial Committee urges caution on proposals that let land be taken back before compensation and resettlement are finished.

It said such cases should be clearly defined, limited to truly necessary and urgent situations that serve the public good, with safeguards for the rights of land users.

A broader answer to Vietnam’s housing affordability problem

The government’s proposed changes cover seven policy areas, from land‑use planning and allocation to pricing, compensation, digitalisation and enforcement.

But Hung’s comments brought those complex reforms back to a problem homebuyers feel directly.

He argues that house prices are the final result of a chain of costs.

Expensive land raises the starting price of a project. Long admin steps add time and costs. Borrowing adds financing costs. Government land fees and other development costs pile up along the way.

By the time a house reaches the market, those costs are built into its price.

The government’s answer is therefore broad: control land‑related input costs, make pricing more transparent, stop fake land values, shorten procedures and lower the financial burden from long project development.

Whether those reforms can lead to cheaper homes will depend on how the new rules are written into law and put into practice.

But Hung made the government’s diagnosis clear: to lower home prices, Vietnam must first cut the costs that add up long before a house reaches the buyer.

Tran Thuong