The Government issues a new Decree on land prices.

Clause 5, Article 158 of the 2024 Land Law stipulates land valuation methods including:

a)Comparative methodis carried out by adjusting the price of land plots with the same land use purpose, certain similarities in factors affecting the price of land transferred on the market, winning the auction of land use rights where the auction winner has fulfilled the financial obligations according to the auction winning decision through analyzing and comparing factors affecting the land price after excluding the value of assets attached to the land (if any) to determine the price of the land plot to be appraised;

b)Income methodis done by taking the average annual net income per land area divided by the average savings interest rate of 12-month term deposits in Vietnamese Dong at commercial banks in which the State holds more than 50% of charter capital or total voting shares in the provincial area for 3 consecutive years up to the end of the most recent quarter with data before the time of land valuation;

c)Surplus methodis carried out by taking the total estimated development revenue minus the total estimated development cost of the land plot, land area on the basis of the most effective land use (land use coefficient, construction density, maximum number of floors of the building) according to the land use planning, detailed construction planning approved by the competent authority;

d)Land price adjustment coefficient methodis done by taking the land price in the land price list and multiplying it by the land price adjustment coefficient. The land price adjustment coefficient is determined by comparing the land price in the land price list with the market land price.

Clarifying the order and content of land price determination

Decree 71/2024/ND-CP specifically stipulates the procedures and contents of determining land prices according to 4 methods including comparison, income, surplus, and land price adjustment coefficient.

The Decree also specifically regulates the application of land valuation methods in the cases specified in Point c, Clause 2, Article 257 of the Land Law.

1. In case of land allocation with land use fee collection, land lease with one-time land rent payment for the entire lease term, which according to the regulations at the time of issuance of the decision falls under the case of applying the land price adjustment coefficient method, and in case of land lease with annual land rent payment, the land price table multiplied by the land price adjustment coefficient at the time of issuance of the decision shall apply. In case of the time of issuance of the decision from July 1, 2014 to December 31, 2014, which falls under the case of applying the land price adjustment coefficient method at the time of issuance of the decision, and in case of land lease with annual land rent payment, the land price table at the time of issuance of the decision shall apply, multiplied by the land price adjustment coefficient of 2015.

2. In case of land allocation with land use fee collection, land lease with one-time land rent payment for the entire lease term, which according to the regulations at the time of issuance of the decision is not applicable to the land price adjustment coefficient method, the methods prescribed in Points a, b, c, Clause 5, Points a, b, c, Clause 6, Article 158 of the Land Law and Articles 4, 5, 6 of this Decree shall apply.

3. In case of land allocation or lease according to the progress of compensation, support and resettlement, depending on each specific case, land valuation methods shall be applied according to the provisions in (1) and (2) above according to each decision.

4. For case (3) above, when applying the surplus method to value land, it is handled as follows:

a) In case there are sufficient conditions to estimate the development revenue and development costs of the land plot or land area, the determination of the estimated development revenue and estimated development costs shall be carried out according to the land allocation and lease area of ​​that decision;

b) In case the development revenue of the land plot or land area cannot be fully estimated or the estimated development cost is greater than the estimated development revenue for the area requiring land valuation, the determination of the estimated development revenue and estimated development cost shall be carried out for the entire project according to the detailed construction plan or master plan approved by the competent authority.

Factors affecting land prices

The Decree specifically stipulates factors affecting land prices.

Accordingly, factors affecting land prices for non-agricultural land include:

a) Location, location of the land plot, land area;

b) Traffic conditions: width, road surface structure, adjacent to 01 or more roads;

c) Conditions of water supply and drainage, electricity supply;

d) Area, size, shape of land plot, land area;

d) Factors related to construction planning include: land use coefficient, construction density, construction boundaries, height limits of construction works, and limits on the number of basements built according to detailed construction planning approved by competent state agencies (if any);

e) Current status of environment and security;

g) Land use term;

h) Other factors affecting land prices in accordance with actual conditions, cultural traditions, and local customs and practices.

Factors affecting land prices for agricultural land include:

a) Crop and livestock productivity;

b) Location, characteristics of land plot, land area: closest distance to production and product consumption place;

c) Traffic conditions serving production and product consumption: road width, road grade, road surface structure; terrain conditions;

d) The land use term, except for agricultural land allocated by the State to households and individuals according to the agricultural land allocation quota, and agricultural land within the quota for receiving transfer rights, is not based on the land use term;

d) Other factors affecting land prices in accordance with local reality, cultural traditions, and customs.

The Decree clearly states: Based on the actual situation in the locality, the organization implementing the proposed land valuation shall have the Department of Natural Resources and Environment preside over and coordinate with relevant departments and branches to advise and submit to the Provincial People's Committee to specify the factors affecting land prices, the maximum difference of each factor affecting land prices to determine a certain level of similarity, and the method of adjustment for each difference of each factor affecting land prices.

In case the provincial People's Committee has not yet specified or has insufficiently specified the factors affecting land prices, the maximum difference of each factor affecting land prices, and the adjustment method for each difference of each factor affecting land prices, the organization implementing land valuation shall propose specific details in the explanatory report on the development of the land price plan for the Land Valuation Council to consider and decide.

Must provide information for land valuation within 05 working days from the date of receipt of request.

The Decree clearly states the responsibilities of agencies and units in providing information. Accordingly, agencies, organizations and units assigned to manage, exploit and use information sources specified in Point b, Clause 2, Article 4 and Point b, Clause 1, Article 5 of this Decree are responsible for providing information to serve land valuation work in writing or electronically within 05 working days from the date of receipt of the request document of the organization conducting land valuation.