RESOLUTION 171/2024/QH15: EXPANDING OPPORTUNITIES FOR LAND BANK FORMATION AND COMMERCIAL HOUSING DEVELOPMENT

1. ADDRESSING BOTTLENECKS IN LAND BANK FORMATION

For many years, real estate businesses have faced difficulties in developing commercial housing projects on agricultural land or non-residential land used for production and business purposes. Although some of these land plots are located in areas designated for urban development and offer favorable locations and development potential, the lack of an appropriate legal mechanism has prevented these land resources from being used effectively.

On November 30, 2024, the National Assembly adopted Resolution 171/2024/QH15, which took effect on April 1, 2025, and is being implemented under a five-year pilot scheme. Subsequently, on April 1, 2025, the Government issued Decree 75/2025/ND-CP, providing detailed regulations for the implementation of the pilot mechanism.

The policy allows real estate business organizations to implement pilot projects by acquiring land use rights or using land for which they already hold land use rights. The eligible land categories include agricultural land, non-agricultural land other than residential land, and parcels comprising both residential land and other land types in the same parcel, in cases where land use rights are acquired through negotiation.

This represents an important change in how businesses can assemble land banks. However, businesses are not free to acquire agricultural land and convert it into commercial housing projects without restrictions. The land must still satisfy requirements relating to the eligible project area, planning, housing development programs, the list of land plots proposed for pilot projects, and other relevant legal regulations.

2. THE REAL ESTATE MARKET THROUGH KEY FIGURES

Market data and policy implementation figures highlight two important issues.

First, there remains a gap between apartment supply and market absorption.

• Approximately 1,900 newly launched apartments were recorded in Ho Chi Minh City in Q3 2026.

• Total primary apartment supply stood at approximately 5,800 units at the time of the report.

• The overall apartment market absorption rate in Q3 2026 was 25%, equivalent to approximately 1,400 transactions.

It is important to distinguish between the 1,900 units representing newly launched supply during the quarter and the 5,800 units representing total primary supply at the time of the report. The 25% absorption rate reflects the overall apartment market, not just the 1,900 newly launched units.

These figures indicate that expanding housing supply must go hand in hand with developing a product mix that aligns with affordability and genuine housing demand.

Second, inclusion in the list of pilot land plots does not mean that a project has already received investment approval.

At an inspection meeting on October 15, 2026, representatives of the Ho Chi Minh City Department of Agriculture and Environment reported that the City People's Council had approved a list of 389 land plots for the pilot scheme under Resolution 171. At the same time, more than 30 projects had received in-principle investment approval. These are two different indicators: one refers to the number of land plots, while the other refers to the number of projects. They should not be used directly to calculate a conversion rate.

Subsequently, an update from the Ho Chi Minh City People's Council indicated that the City had approved a list of 147 land plots, covering approximately 854 hectares, for commercial housing projects under Resolution 171. Approval of the list provides a basis for proceeding with the pilot mechanism but does not replace the relevant investment, land, and planning procedures.

In addition, Resolution 171 stipulates that the total residential land area within pilot projects—including existing residential land and land intended to be converted into residential land—must not exceed 30% of the additional residential land area planned for the relevant planning period compared with the existing residential land-use status, as specified in the approved provincial land allocation and zoning plan for the 2021–2030 period.

3. CHANGES TO THE LAND BANK DEVELOPMENT FRAMEWORK

Resolution 171 broadens the scope of land resources that businesses can explore. Instead of focusing exclusively on plots that already have residential land, project developers can also consider agricultural land and production land located in urban areas or areas designated for urban development, provided that the relevant pilot conditions are met.

However, land selection now requires more rigorous due diligence. A low acquisition price or a favorable location alone is not enough to establish a land plot's development potential. Businesses must assess its existing legal status, land-use planning, housing development programs, and eligibility for inclusion in the list of land plots proposed for pilot projects.

The ability to prepare and complete legal dossiers, negotiate the acquisition of land use rights, and coordinate with local authorities may therefore become a significant competitive advantage.

4. OPPORTUNITIES AND CHALLENGES FOR PROJECT DEVELOPERS

Planning and infrastructure: Land plots must be consistent with urban development orientations, land-use plans, and housing development programs in accordance with applicable regulations. Businesses should also assess connectivity to transport networks, electricity and water supply, drainage systems, and social amenities. A land plot that is compliant with planning requirements but lacks adequate infrastructure connectivity may incur substantial additional investment costs and face difficulties in selling its products.

Legal procedures: Inclusion in the list of land plots proposed for pilot projects does not mean that a project has completed its investment procedures or is ready for implementation. Businesses must still complete the applicable procedures relating to land use rights, in-principle investment policy approval or investment approval, as applicable, land-use purpose conversion, financial obligations, planning, and construction.

Under Decree 75/2025/ND-CP, the provincial land management authority has 15 days from the end of the registration period to review and assess eligibility and prepare a list of land plots proposed for pilot projects for submission to the provincial People's Committee. After the provincial People's Council issues a resolution approving the list, the provincial People's Committee must publish it within three working days. Notices accepting real estate business organizations for pilot project implementation, as well as notices regarding applications that fail to meet the requirements, must be issued within five working days from the date the list is published. These are deadlines for individual procedural stages, not the total time required to complete all legal procedures for a project.

Financing and implementation timelines: Delays in completing legal procedures may increase capital costs, interest expenses, management costs, and opportunity costs. Businesses should therefore develop financial scenarios based on implementation timelines and land-related financial obligations, rather than calculating project feasibility solely on the initial land acquisition price.

Market demand and absorption capacity: Expanding the land bank does not automatically result in more affordable housing. Selling prices remain dependent on land costs, infrastructure investment, construction expenses, financing costs, and product mix. Developers need to identify the right customer segments, genuine housing demand, and purchasing power in each location.

5. FIVE STRATEGIC INSIGHTS FROM RESOLUTION 171

5.1. Land value increasingly depends on the ability to complete legal procedures.

Businesses need to move beyond evaluating land solely on price and location, and instead assess its potential to be converted into a viable development project.

5.2. The list of pilot land plots is an important source of information for investment strategies.

Monitoring these lists in each province and cross-referencing them with planning documents and housing development plans can help businesses identify potential opportunities proactively.

5.3. Expanding housing supply does not necessarily lead to lower housing prices.

The effectiveness of the policy also depends on financial obligations, investment costs, and the ability to develop products that meet actual market demand.

5.4. Infrastructure has a direct impact on the development potential of land banks.

Land plots with convenient access to residential communities, employment centers, and transport networks may have an advantage in generating genuine housing demand.

5.5. Legal expertise and investment partnerships can become competitive advantages.

The new mechanism provides an additional basis for businesses to explore cooperation with land users, mergers and acquisitions (M&A), and project development. However, each arrangement must comply with the applicable legal requirements.

6. FROM LAND OWNERSHIP TO PROJECT DEVELOPMENT CAPABILITY

In the coming period, businesses will need to change how they manage their land banks. Investment portfolios should not be assessed solely by the total area of land under their control. Instead, land assets should be classified according to their legal status: land use rights already secured, land being assessed for pilot eligibility, land included in the list of plots proposed for pilot projects, projects granted in-principle investment policy approval, and projects eligible to proceed with construction.

Businesses should also monitor key indicators such as the area of land included in the pilot list, the number of projects receiving approval, the time required to complete legal procedures, land-related financial obligations, total investment capital, and the market absorption potential of the resulting products.

Resolution 171 has a five-year pilot period starting on April 1, 2025. Businesses should proactively manage their implementation schedules while taking note of the provision allowing real estate business organizations that are implementing pilot projects in accordance with the schedules specified in their approved investment projects to continue implementation until completion, even after the Resolution expires.

CONCLUSION

Resolution 171/2024/QH15 creates new opportunities for land bank formation and commercial housing development. However, it does not eliminate the legal, planning, or financial requirements applicable to real estate projects. For real estate developers, competitive advantages will depend not only on their ability to access land, but also on their capacity to conduct due diligence, complete legal procedures, control costs, and organize project implementation. In the long term, businesses that can effectively convert land resources into viable projects that meet market demand will be better positioned to build sustainable competitive advantages.