Land auctions in rural areas are booming.

(Baonghean) - Previously, the land market in rural areas of Nghe An province was quite sluggish. However, since 2016, land transactions have become vibrant again. Thanks to the availability of land, localities have more resources to build infrastructure.

In Bac Thanh commune, Yen Thanh district, the land auction at the end of 2016 was quite lively. Mr. Le Van Thuy, Vice Chairman of the People's Committee of Bac Thanh commune, said: The commune has proposed to the District People's Committee to plan the auction of land along National Highway 7b to develop commercial services.

The People's Committee of Bac Thanh commune, in coordination with an international auction company, organized an auction for the right to use 38 land plots along National Highway 7b. The auction was very lively, with more than 300 customers from within and outside Bac Thanh commune. Most of the land plots offered for auction were priced higher than the starting price. For example, 1 square meter of land, which was 2.3 million VND before the auction, increased to 3.5 million VND per square meter after the auction.

Officials guide residents through the procedures for bidding on land in Yen Thanh town.Photo: Van Truong

In April 2017, Bac Thanh commune is expected to auction off 40 plots of land along National Highway 7b. However, according to Mr. Le Van Thuy, to ensure safety in land auctions, especially to prevent land brokers, the commune proposes increasing the deposit to 30% of the land value for the next auction to limit brokers, and inviting reputable land auction companies to organize the auctions to avoid collusion between auction companies and brokers to manipulate prices and make illicit profits. In addition to the commune's security forces, the District People's Committee needs to strengthen the district police force to ensure security for the land auction.

According to Mr. Nguyen Thanh Ha, Vice Chairman of the Yen Thanh District People's Committee, real estate transactions in the district have recently become more active again. In 2016, Yen Thanh auctioned off land use rights for more than 300 plots of land, worth over 82 billion VND.

The renewed vibrancy of this market can be explained by the easing of some credit policies. Right in the towns and townships, there is increased demand from people buying properties for commercial purposes. Although prices have been adjusted, they remain at reasonable levels.

Therefore, most of the land plots offered for public auction were sold out. To curb land speculation, the district implemented solutions such as setting starting land prices close to market value, educating the public about legal regulations against cooperating with land speculators; and mobilizing security forces to protect the area before, during, and after the land auction.

A land auction in Yen Thanh town.Photo: Van Truong

Not only in Yen Thanh, but also in Quynh Trang commune, Hoang Mai town, the land market has been "warming up" again in recent years. Mr. Le Si Hiep from Quynh Trang commune shared: "Because we needed to buy land for business, my wife and I submitted an application to bid and successfully purchased land in Hamlet 3, bordering the road leading to Vuc Mau Lake, with an area of ​​247 m2, at a price of 3 million VND/m2."²".

Mr. Le Dinh Si, a land administration official in Quynh Trang commune, said: "In the recent land auction, Quynh Trang planned to sell 13 plots of land, but more than 100 people registered and all were sold out after the auction, with a total value of over 6.2 billion VND. Currently, there are quite a lot of project land in Hoang Mai town, but people prefer to buy state-owned land because they feel more secure, and they receive the land title immediately after purchase."

The town has approved reasonable land prices, and Quynh Trang commune has focused on investing in complete infrastructure, making it convenient for land buyers to build houses. Quynh Trang has just continued planning and preparing to auction 19 residential land plots, with a state-set price of 500,000 VND/m2, expected to reach 1.2-1.5 million VND/m2 after the auction. Thanks to the 40% land allocation, the commune has the budget to build infrastructure, determined to achieve the new rural development goals in 2018.

Mr. Pham Van Hao, Head of the Department of Natural Resources and Environment of Hoang Mai town, added: In 2016, Hoang Mai town auctioned off land use rights for over 250 plots of land, with a total value of more than 80 billion VND. Localities with the most successful land use rights auctions include Mai Hung ward with 43 plots worth 19 billion VND; and Quynh Phuong ward with 18 plots worth 4.3 billion VND…

The auctions were bustling, and to ensure transparency, safety, and fairness, the Hoang Mai Town Auction Steering Committee strengthened security measures; they also implemented solutions to raise the bidding price to prevent land brokers from negotiating. All bidders were issued identification cards; those entering the auction without a card would be asked to leave by security personnel.

Currently, all 10 communes and wards in Hoang Mai town have land use plans. Depending on the needs, localities auction off land. In Hoang Mai town alone, there are currently 6 infrastructure investment projects for "subdividing and selling plots," among which the Cua Corn residential, tourism and service area project in Quynh Di ward has sold the most land plots due to its relatively comprehensive infrastructure investment.

In Quynh Di ward, Hoang Mai town, where land use rights have just been auctioned off, residents are now beginning construction of houses.Photo: Van Truong

Despite the achievements, the auctioning of assets still faces some shortcomings and limitations due to infrequent public awareness campaigns, resulting in a low number of people having access to information to participate in auctions. Meanwhile, the process of transferring and auctioning land involves local authorities, so when land auctions are transferred to businesses, people lack confidence and therefore do not participate in the auctions.

Furthermore, the practical skills and experience of auctioneers in some auction organizations are insufficient for specific tasks. There are still instances of collusion, price manipulation, and asset sales exceeding the starting price. There are also a lack of criteria for selecting auction organizations and mechanisms for controlling auctions. The distribution of auctioneers and asset auction organizations is uneven across regions.

In the province, the team of auctioneers and asset auction businesses are currently concentrated mainly in Vinh City. Some localities, such as Que Phong, Quy Chau, Tuong Duong, Ky Son, and Con Cuong, have not yet signed auction contracts with asset auction businesses. Therefore, it can be said that, at this time, the guidelines on determining the starting price for auctioning land use rights when the State allocates land with land use fees or leases land are not consistent, leading to many difficulties and obstacles in applying them to organize land use right auctions at the local level.

Van Truong