Foreigners leasing/ renting houses in Vietnam is a fairly common transaction. Since the opening of the market, Vietnam has allowed foreigners entry into the country to make transactions of purchasing houses and leasing houses and land on Vietnamese territory in accordance with the provisions of the law. Join NPLAW to learn about the regulations concerning the rental of houses in Vietnam by foreigners!
I/ The popularity of foreigners leasing houses in Vietnam
Currently, landlords are looking forward to allowing foreigners to lease/ rent their houses because lease fees (rental fees) will be high, tenants will be knowledgeable and polite, and their leasing assets will have an opportunity for enhancement.
Foreigners, however, also have their own strict leasing factors. Not all leasing properties are of interest to foreigners, although it is a significant expectation for many landlords. A part of the reason is their homeland’s customs and lifestyle, as well as the need to live in a suitable community when working in another country.
Nowadays, transactions for foreigners to lease houses in Vietnam are becoming increasingly popular. The law also has strict provisions on terms between the action of renting out and renting to safeguard the legitimate rights and interests of the parties in the transaction.
II/ Legal regulations for foreigners to lease houses in Vietnam
Here are some regulations for foreigners to lease houses in Vietnam:
1. Definition of foreigners leasing houses in Vietnam
Clause 1 Article 3 of the Law on the Entry, Exit, Transit, and Residence of Foreigners in Vietnam regulates: A foreigner is a person obtaining a document identifying foreign citizenship and a stateless person entering, leaving, transiting or residing in Vietnam.
Besides, pursuant to regulation at Article 472 of the Civil Code 2015 stipulating an asset lease contract:
- An asset lease contract is an agreement between the parties whereby the landlord gives the asset to the tenant for use for a certain period of time, and the tenant shall pay the lease. In addition, contracts leasing houses or contracts leasing houses for other purposes shall be executed in accordance with the provisions of this Code, the Law on Housing and other relevant legal regulations.”
From the above regulations, it can be understood that a foreigner leasing a house in Vietnam is a person obtaining a document identifying foreign citizenship and a stateless person entering, leaving, transiting or residing in Vietnam making a lease agreement with a landlord in Vietnam to use it for a duration and paying the landlord in accordance with the provisions of the law or agreement between the parties.
2. Conditions for foreigners to lease houses in Vietnam
The conditions for foreigners to lease houses in Vietnam according to Point b, Clause 2, Article 119 of the Law on Housing 2014 are:
- Need to have capacity for civil acts to perform transactions on housing.
- Need to belong to entities that are allowed to own a house in Vietnam according to the regulations and are not required to have temporary or permanent registration at the place where such a house is transacted.
3. Procedures for foreigners to lease houses in Vietnam
For allowing foreigners to lease a house in Vietnam doesn't belong to cases where it is required to register a business; accordingly, it only needs to perform two steps:
Step 1: Signing a contract
The parties shall agree and sign a lease agreement to ensure the best rights and interests of the parties.
Step 2: Paying taxes
For a real estate lease, the landlord must pay the personal income tax.
III/ Questions regarding foreigners leasing houses in Vietnam
Here are some answers to questions about foreigners leasing houses in Vietnam.
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1. Does the applicable law limit the house lease duration of foreigners in Vietnam?
Pursuant to Clause 1, Article 129 of the Law on Housing 2014, the lease duration is as follows:
- The landlord and the tenant shall agree on the lease duration, the lease price (rental price) and the payment method according to the periodical or one-time basis method. If the State has a specific regulation on the rental price, the parties shall comply with that regulation.
Accordingly, the lease duration is agreed upon by the parties and does not mention such a duration for foreigners in Vietnam. The applicable law also does not limit the specific lease duration for foreigners in Vietnam.
2. Can foreigners lease private houses in Vietnam from households or individuals?
Pursuant to Point b, Clause 2, Article 119 of the Law on Housing 2014 stipulating regulations on the conditions for foreigners to lease houses in Vietnam, as follows:
- If an entity is a foreign individual or an overseas Vietnamese, such a person needs to have competent civil act capacity to perform housing transactions in accordance with the provisions of the Vietnamese law, need to belong to subjects who are allowed to own houses in Vietnam under this law, and is not required to register a temporary residence or permanent residence at the place where a house is transacted.
At the same time, Clause 2, Article 159 of the Law on Housing 2014 regulates:
- Foreign organizations and individuals can own houses in Vietnam through the following forms:
- Investing in housing construction projects in Vietnam in accordance with the provisions of this Law and relevant legal provisions;
- Purchasing, leasing, receiving, donating and inheriting commercial houses, including apartments and individual houses (independent houses) in housing construction investment projects, except for areas that need to ensure defense and security as regulated by the Government.
According to the above regulations, there is no regulation restricting any form of leasing houses to foreigners in Vietnam. Therefore, foreigners leasing houses in Vietnam can lease private houses of households or individuals. Only in cases of housing ownership, foreign organizations and individuals might own private housing in housing construction investment projects according to the above regulations.
3. Do foreigners leasing houses in Vietnam take any legal responsibility for damaging assets in the leasing house?
Pursuant to Clause 1, Article 479 of the Civil Code 2015, the obligations to preserve leasing property is as follows:
- The tenant shall preserve the leasing property, maintain it and make minor repairs; accordingly, if it is lost or damaged, the tenant needs to pay compensation. The tenant is not responsible for any natural wear and tear resulting from the use of the leasing property.
=> Accordingly, the tenant will be liable to compensate the landlord for the loss or damage caused.
In addition, if a foreigner leases a house in Vietnam and damages property in the leasing house, such a foreigner may be fined according to Clause 2, Article 15 of Decree 144/2021/ND-CP regulating the violation of the regulations in causing damages to the property of organizations and individuals, specifically:
- Fine ranging from 3 million VND to 5 million VND for one of the following acts: Destroying or deliberately damaging the property of individuals or organizations, except in the case of violating the regulations in Point b, Clause 3, Article 21 of this Decree;
Furthermore, in the event that the tenant deliberately damages or destroys a leasing house, the tenant may be liable for criminal liability for the Crime of Destruction or Deliberate Damage to property under Article 178 of the Criminal Code 2015, as amended by Clause 36, Article 1 of the Law on Amendment to the Criminal Code 2017.
IV/ Consulting services for foreigners leasing houses in Vietnam
NGOC PHU LAW COMPANY (NPLAW) is one of the most prestigious law firms, committed to consulting and resolving promptly and in a timely manner, and providing good-quality service at a reasonable service fee. With certain knowledge and rich experience in the legal sector, especially the regulations on foreigners leasing houses in Vietnam, a team of professional, dedicated and enthusiastic lawyers will help the valued Clients come up with the best solution and safeguard your rights and legitimate interests.
Please contact NPLAW, we are willing to advise via hotline or email along with the best support to help solve legal issues that arise or legal difficulties that you cannot solve. The valued Clients can completely trust and contact NPLAW immediately using the following information:
