Condotel And Legal Gaps

Condotel is a vibrant segment of the real estate market. However, as well as the office-tel, condotel also meets legal roadblocks.

Supplies increase more and more

The recent appearance of condotel has brought to the real estate market a lot of new attraction. The race of investors in this segment is increasing and there is no sign of slowing down. Along the country, especially in large cities, which have the advantage of proximity to the sea, there are more and more the condotel and the transaction is becoming more exciting.

Only in 2016, in the three markets of Danang, Nhatrang and Phuquoc, 12,000 condotels were offered for sale, with over 70% of sales. In 2017, although the number of products launched to the market is forecasted not decreasing compared to 2016. In addition to the above markets, Vungtau, Phanthiet are promising places for condotel.

The recent appearance of condotel has brought to the real estate market a lot of new attraction.

According to Mr. Pham Lam, General Director of Asia Real Estate Joint Stock Company (DKRA), not only this year but also the coming years, both domestic and foreign investors will pour money into the Vietnam resort property, including condotel type. This is an almost obvious trend and promises to bring many opportunities for the owners and stakeholders.

At a recent office-tel conference in Ho Chi Minh City, Nguyen Tran Nam, Chairman of the Vietnam Real Estate Association, said that as well as office-tel, the condotel model in Vietnam is creating new investment trends for both the owner and the client. It means that the return on condotel investment is quite high for both sellers and buyers. That is the reason why many owners have pledged to ensure a minimum return of 12% for the owners of apartments in the first eight years.

The granting of land use rights and ownership of hotel apartments to condotel buyers is also a complex issue.

For investor, due to the fact that the legal procedures related to the condotel type are not clear. The warning of real estate professionals about the possibility of ambiguity, dodging the law, or running risks of the investors who lack prestige are not without reason.

When building a mechanism, policy, especially in the field of real estate, the first thing is the harmony between the interests of the state – the investor – the owner. In the field of condotel – a type of investment that promises more efficiency for the parties – is no exception. This legal space is only dealt with when the Government, the Ministry of Construction and other concerned sectors issue specific regulations soon. Whenever the responsibility of the investor, the owner, the form of ownership is well defined, the condotel will have a breakthrough in its own right.

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