WHEN LEGAL BOTTLENECKS ARE NO LONGER THE “CHOKE POINT”: RETHINKING PROJECT COSTS AND TIMELINES FOR PROPERTY DEVELOPERS

FROM REMOVING ADMINISTRATIVE OBSTACLES TO CHANGING HOW PROJECTS ARE MANAGED

In previous market cycles, the fact that a project could take years to complete its legal procedures placed considerable pressure on businesses. During this waiting period, land assets could not yet be converted into marketable products, while companies still had to bear administrative and financing costs. At the same time, initial assumptions regarding land prices, interest rates, market demand and product mix could change significantly.

The year 2026 has seen a series of policies aimed at addressing these issues simultaneously. On July 3, 2026, the Government issued Resolution No. 175/NQ-CP on the proposal to develop policies for amendments and supplements to the Law on Housing and the Law on Real Estate Business. The Resolution approved six policy areas under the Law on Housing, including policies on decentralization and delegation of authority, the reduction and simplification of administrative procedures, housing development funding, and housing transactions. With regard to the Law on Real Estate Business, the Government approved four policy areas, focusing on resolving practical obstacles, revising business conditions and administrative procedures, appropriately delegating authority under the two-tier local government model, and improving mechanisms for regulating the real estate market.

On September 18, 2026, the Government continued this process by issuing Resolution No. 278/NQ-CP on the September 2026 thematic session on law-making. Regarding the draft amended Law on Housing and Law on Real Estate Business, the Government requested further review to ensure consistency and coherence with the amended Land Law and other relevant legislation, while addressing transitional provisions, overlaps and regulatory conflicts so that the new regulations can be effectively implemented. The Resolution also calls for mechanisms to comprehensively resolve long-standing and stalled projects and simplify administrative procedures based on a single point of contact and one-stop-shop mechanism, combined with decentralization and delegation of authority.

At the administrative-procedure level, on September 18, 2026, the Ministry of Construction issued Decision No. 1649/QD-BXD, announcing amended and supplemented administrative procedures in the field of real estate business. Under the Decision, the procedure for notifying the eligibility of future-built housing for sale or lease-purchase has a processing time of no more than 15 days from the date on which the competent authority receives a complete and valid dossier. The Department of Construction is the competent authority responsible for making the determination and carrying out the procedure.

These developments indicate that legal reform is being implemented across multiple levels—from policymaking to practical administrative execution—rather than focusing solely on amendments to individual regulations.

HOREA AND THE TASK OF ELIMINATING OVERLAPPING PROCEDURES

Alongside the Government’s policy-making process, recommendations from the business community and professional associations have also focused on procedures that directly affect project implementation.

On August 6, 2026, the Ho Chi Minh City Real Estate Association (HoREA) issued Official Letter No. 93/2026/CV-HoREA, proposing that the competent authorities consider abolishing the requirement for commercial apartment project developers to register standard-form apartment sale contracts with the Department of Industry and Trade. On August 12, 2026, HoREA issued Official Letter No. 98/2026/CV-HoREA, providing comments on the policy orientation report for amendments to the 2023 Law on Real Estate Business. These documents form part of HoREA’s broader series of recommendations concerning the review and adjustment of regulations that may create additional administrative procedures or overlaps between different areas of legislation (Source: horea.org.vn).

For property developers, eliminating a procedural requirement is not merely about reducing the number of documents that need to be prepared. When procedures are designed with clearly defined authorities, documentation requirements and processing timelines, developers can integrate their legal, financing, construction and sales schedules into a single project plan rather than managing them as separate workstreams.

4,685 PROJECTS AND A SIGNIFICANT VOLUME OF CAPITAL BEING UNLOCKED

The data on stalled projects illustrates that the scale of the issue lies not only in the number of projects involved, but also in the amount of capital that has been tied up. As of September 15, 2026, among the 4,685 troubled, problematic and long-stalled projects registered on System 751, 3,407 projects, or 72.7%, had completed classification and resolution, with no remaining obstacles falling under the jurisdiction of ministries, central agencies or local authorities. The total investment capital of these projects was reported by VTV, citing HoREA data, at more than VND 2.5 quadrillion. In addition, 1,123 projects had proposed solutions for further implementation, while 155 projects had been proposed for resolution under the authority of the National Assembly, the Government or the Prime Minister (Source: vtv.vn).

In Ho Chi Minh City, as of September 5, 2026, 1,338 troubled, problematic and long-stalled projects had been registered on the Department of Finance’s System 45, covering a total area of more than 30,691 hectares and representing total investment capital of VND 658.084 trillion. Of the 921 projects compiled following the implementation of National Assembly Resolution No. 29/2026, the city had resolved the obstacles facing 233 projects, or 25.3%, after three months of implementation. Across all phases, Ho Chi Minh City had resolved difficulties and obstacles for 650 long-stalled projects (Source: vov.gov.vn).

These figures indicate that the process of resolving legal obstacles is directly affecting the ability to return land resources and capital to the investment cycle. However, an important distinction must be made: the number of projects classified or having their obstacles resolved does not mean that all such projects have completed every condition required to launch products onto the market. Once legal obstacles have been addressed, each project must still satisfy its obligations relating to land, construction, financial matters and statutory conditions for conducting business.

WHEN THE LEGAL TIMELINE BECOMES A VARIABLE IN THE FINANCIAL MODEL

For property developers, perhaps the most significant change lies in how the investment timeline is determined. Previously, developers often had to build financial models around lengthy and difficult-to-predict legal preparation periods. As procedures become more standardized and processing timelines more clearly defined, the legal timeline can increasingly be incorporated directly into a project’s cash-flow model as a manageable variable.

For example, assuming that the period from land allocation to eligibility for launching products on the market is shortened from four to five years to 1.5 to two years, the period during which capital is deployed before generating revenue would decrease accordingly. As a result, capitalized interest expenses could decline, the timing of capital recovery could be brought forward, and project metrics such as IRR, NPV and WACC could potentially improve. However, this is a financial analysis based on assumptions, rather than an established outcome applicable to all projects in the market.

Conversely, a shorter legal process also means developers must prepare funding earlier. Once a project moves more quickly from the legal stage to the stage of fulfilling financial obligations, construction and sales, developers can no longer rely primarily on expectations of rising land values during the waiting period.

CEOHomes Hana Garden provides a specific example. According to CEO Group, the project covers 20.3 hectares and contributed VND 2.134 trillion in land-use fees to the State budget during its initial phase. This figure illustrates that once a project moves beyond the legal stage and into actual implementation, its funding requirements do not disappear; rather, they shift toward the developer’s ability to meet financial obligations and implementation costs on schedule (Source: ceogroup.com.vn).

FROM “HAVING LEGAL CLEARANCE” TO “HAVING THE CAPACITY TO EXECUTE”

As more projects are unlocked simultaneously, the competitive advantages of developers may also change. Previously, owning land and securing legal approvals could represent a significant advantage in a market characterized by limited supply. But as supply is released, legal clearance alone is no longer sufficient to ensure that a project can achieve market absorption.

Developers must simultaneously manage legal timelines, funding, land-related financial obligations, planning, design, infrastructure, construction quality and sales strategy. Products need to be determined based on the demand of each specific market rather than simply on the development potential of the land bank.

In Ho Chi Minh City, during the first seven months of 2026, HoREA reported that 37 real estate and commercial housing projects were eligible to raise capital, providing 27,374 housing units, including 21,165 condominium units and 6,209 low-rise housing units—1.64 times the number recorded during the same period in 2025.

If the trend of improving supply continues, market absorption capacity will become an increasingly important variable in investment and product-development decisions. This also requires a broader approach to project assessment. The question is no longer simply:“Has the project completed its legal procedures?” It must be expanded to: “Once the legal requirements have been completed, does the project have sufficient financial capacity, execution capability and a suitable product offering to generate sustainable cash flow?”

FINANCIAL CAPACITY AND M&A WILL BECOME INCREASINGLY IMPORTANT VARIABLES

As legal obligations become clearer and processing timelines become shorter, the developer’s actual financial capacity will be tested more directly. A project may have its legal obstacles resolved, but if the developer lacks the resources to fulfill financial obligations, fund construction or complete the conditions required for sales, the project may still encounter difficulties during implementation.

This provides a basis for greater differentiation among developers. Developers with stronger financial capacity, project-management systems and cash-flow management capabilities will be better positioned to move quickly from legal clearance to implementation. Conversely, projects that lack funding or are no longer aligned with the existing developer’s capabilities may generate demand for restructuring, joint ventures or project transfers.

Against this backdrop, M&A may become an important channel for addressing projects whose legal status has been clarified but whose existing developers no longer have sufficient resources to proceed. However, the value of a project in an M&A transaction must still be assessed holistically, taking into account its legal status, land-related matters, financial obligations, planning, total investment requirements, financing capacity and market demand.

Resolution No. 278/NQ-CP also calls for a review to ensure consistency between the draft amended Law on Real Estate Business and the Investment Law and other relevant legislation. This includes provisions concerning the authority to approve the transfer of real estate projects as powers are delegated to provincial-level People’s Committees. This is one of the areas with direct implications for project restructuring and project-transfer transactions.

THE POST-“UNBLOCKING” MARKET WILL PLACE GREATER EMPHASIS ON UNDERLYING VALUE

If the process of resolving stalled projects continues alongside the completion of amendments to the Law on Housing and the Law on Real Estate Business, the market may enter a phase in which actual execution capability becomes a more important competitive factor among developers.

An increase in supply does not necessarily mean that all products will be absorbed quickly. As multiple projects return to the market simultaneously, developers will need to address pricing, product positioning, construction timelines, amenities, quality and infrastructure connectivity at the same time. Projects that rely primarily on legal clearance or land-bank advantages will face competition from projects featuring more integrated master planning and products designed more closely around actual buyer demand.

Over the longer term, this process could encourage property developers to shift from a model centered on land-bank accumulation and value appreciation during the holding period toward a project-development model driven by cash flow, execution timelines and the ability to deliver marketable products.

At the same time, projects with clear legal status, well-defined financial obligations and demonstrated execution potential may be better positioned to attract joint-venture partners, strategic investors and M&A capital.

CONCLUSION

The resolution of obstacles affecting thousands of projects, together with the continued development of the legal framework, is creating an important shift in Vietnam’s real estate market: the legal timeline is increasingly being viewed as a manageable variable in project-development economics.

Resolution No. 175/NQ-CP, with six policy areas concerning the Law on Housing and four concerning the Law on Real Estate Business; Resolution No. 278/NQ-CP on further developing and harmonizing the relevant draft laws; and Decision No. 1649/QD-BXD on administrative procedures in the real estate business sector together form a policy chain extending from institutional reform to practical implementation (Source: thuvienphapluat.vn).

For developers, this means that project development strategies need to be recalculated across the entire project life cycle—from the time required to complete legal procedures and financing costs to land-related financial obligations, construction schedules, capital-raising capacity and product absorption rates.

Legal clearance remains the foundation. But as procedural bottlenecks are gradually addressed, competitive advantages are likely to shift more strongly toward financial strength, execution capability and the ability to create products that align with actual market demand.

In the next phase of the market, clear legal status is only the starting point; the true value of a developer lies in its ability to turn legally unlocked land into a project with sustainable cash flow, marketable products and controlled investment returns.