New aspects of residents' benefits under the Housing Law 2023

SERVICE FEES  

Article 151 of the Housing Law 2023 redefines operational management service fees. Accordingly, fire insurance premiums and wages for Building Owner' Committees are separated from service fees. The advantage of this regulation is that it helps residents better understand the composition and purpose of each fee, fostering confidence in transactions at the project. In practice, while Housing Law 2023 changes the composition of service fees that residents must pay, it will significantly change the establishment of a sustainable revenue source for the project's maintenance funds. This will provide the project with a stable additional income for the maintenance funds, contributing to the upkeep, maintenance, and extension of the project’s lifespan. 

Therefore, the Housing Law 2023 may affect the service fees that residents and customers need to pay in the short term. However, in the long term, it will help ensure a sustainable maintenance budget for the project and contribute to extending its viability.

As regulated in the Housing Law 2023, changes to the service fee structure need to be communicated clearly and promptly to residents to ensure consensus and adequate time to adapt to new methods. Savills implemented this in our projects after receiving official information regarding the effective date. 

Read more: Comparison of the Housing Law 2023 and 2014 with Its Impacts on Building Operations

LEGAL DOCUMENTS 

According to Decree 95, developers must publicly disclose the legal documentation of the project to buyers and lease-to-own tenants, including the construction acceptance record, fire safety approval documents, construction agency approval notices, and parking area plans. The Housing Law 2014 did not regulate this. The new Law also attached to the Housing Law 2023, adds regulations on identifying common-private area ownership if the contract needs to be stated clearly. Although these regulations may affect the timeline of the apartment handover process, they ensure transparency and safety and reduce risks for buyers.

Furthermore, the classification of apartment buildings is now more strictly regulated under the Housing Law 2023. Based on more specific criteria than the previous law, apartment buildings will be classified as 1, 2, or 3 instead of A, B, or C. This regulation promotes transparency in the classification of apartment buildings, enabling customers to assess project quality accurately and pay appropriate fees. 

PROFESSIONAL CAPACITY OF PROPERTY MANAGEMENT COMPANY AND BUILDING OWNER’S COMMITTEE 

According to Articles 20 and 29 of the Regulation on the Management and Use of Apartment Buildings, attached to Circular 05/2024/TT-BXD, property management companies and Building Owner’s Committees are required to participate in training courses on building management to obtain certification recognising their legal status. 

Read more: How to Distinguish Owners' Committees from Management Boards 

Also, the operational management service contract has a minimum term of 12 months and a maximum of 3 years, according to the Building Owner’s Committee terms. The amended Housing Law requires property management companies and the Building Owner’s Committee to enhance their professional capabilities to improve the quality of daily life and protect residents' rights.

BUILDING QUALITY 

According to Article 58 of the Housing Law 2023, the lifespan of apartment buildings is now regulated based on design documentation and the actual usage period of the building rather than being set at 50 years, as in the Housing Law 2014. This provision allows developers to control project quality more tightly, enabling timely maintenance, repairs, or reconstruction. Residents' living environment will be ensured to be safe and convenient by legal regulations.

The Housing Law 2023 focuses on the quality of construction and property management services to ensure residents' rights. The amendments clarify several points compared to the previous Law, promoting a transparent legal environment and fostering confidence for residents in transactions and living experience in the project. With a deep understanding of the law and experience managing many large apartment projects, Savills assists developers in updating changes in the law and advising them on appropriate adjustments. Our international management solutions will help developers maintain stable operations in compliance with the current Law, enhancing residents' living experience. 

Learn more about our Property Management services. 

Read more: 

• Building Owner’s Committee: Key Considerations in Applying the Housing Law 2023