Guide to Transferring an Off-plan Apartment

Transferring an off-plan apartment is a primary concern for homeowners involved in transactions for condominium units that do not yet have an ownership certificate. This article provides a detailed guide to the process of transferring a condominium unit that is considered housing to be formed in the future.

Legality of Transferring Off-Plan Apartments

Many owners of condominium units without a Certificate of Ownership (the “sổ hồng” or pink book) question the legality of such a transfer. This is a common issue, especially for properties in projects still under construction.

Future-formed housing, as defined in Clause 24, Article 2 of the Law on Housing 2023, is “housing that is under construction or has not yet been accepted for use in accordance with construction laws.” A condominium unit without an ownership certificate falls into this category.

Point a, Clause 2, Article 160 of the Law on Housing 2023 states: “Transactions for the sale, lease-purchase, or mortgage of future-formed housing are not required to have a Certificate.” This provision legalizes the transfer of a condominium unit before the ownership certificate is issued. The Law on Housing 2023 officially recognizes and protects these transactions, facilitating a more transparent and accessible market for future-formed real estate.

Conditions for Transferring an Off-plan Apartment

While legal, the transaction of transferring an off-plan apartment must adhere to strict conditions outlined in the Law on Housing 2023. These conditions apply to the legal status of the property and the capacity of the involved parties.

Conditions for the Apartment

An off-plan condominium unit must meet specific legal criteria to be eligible for transfer. According to Clause 1, Article 160 of the Law on Housing 2023, the property must be free from certain legal encumbrances.

• The apartment must not be subject to seizure for judgment enforcement or to enforce an effective administrative decision.
• The property must not be subject to a temporary emergency measure or a restraining order from a court or competent state agency.
• The apartment must not be subject to a land recovery decision or a notice of clearance or demolition from a competent authority.

A valid transaction requires the apartment to be legally “clean,” without any disputes, seizure orders, or clearance plans.

Conditions for Transacting Parties

The law also specifies requirements for the seller and buyer in the process of transferring an off-plan apartment.

The transferor (seller) must meet the conditions in Clause 1, Article 161 of the Law on Housing 2023:

• The seller must have full civil act capacity and not have their capacity restricted.
• The seller must be the legal owner of the apartment sale and purchase agreement or be legally authorized to conduct the transfer.

The transferee (buyer) must meet the conditions in Clause 2, Article 161 of the Law on Housing 2023:

• A domestic individual is not required to have registered residency at the location of the transacted property.
• A foreign individual or a Vietnamese person residing abroad must be eligible to own housing in Vietnam under the Law on Housing 2023 and comply with the Land Law 2024.
• An organization must meet the entity requirements under civil law, regardless of its place of business registration or establishment, per Clause 3, Article 161. A foreign organization must also be eligible to own housing in Vietnam.

Furthermore, all parties must comply with regulations on taxes and fees related to the contract transfer, as stipulated in Clause 3, Article 13 of Decree 96/2024/NĐ-CP, dated July 24, 2024. A secure transaction depends on meeting conditions for both the property and the parties involved.

Procedure for Transferring an Off-plan Apartment

The process of transferring an off-plan apartment carries risks if the legal procedure is not understood. However, a safe and legal transaction is achievable. This guide details the entire procedure, from dossier preparation to a 7-step process with relevant parties.

Required Dossier

Preparing a complete dossier is the first requirement for a smooth and legally recognized transaction. According to Article 13 of Decree 96/2024/NĐ-CP (dated July 24, 2024), the necessary documents include:

• The official text of the transfer of the sale and purchase agreement, using the form in Appendix XI of Decree 96/2024/NĐ-CP.
• The original sale and purchase agreement signed with the project developer.
• Personal identification documents of all parties (valid citizen ID card or passport). For an organization, the Business Registration Certificate, establishment decision, and letter of authorization for the legal representative are needed.
• The handover record of the housing unit, if available, as per Article 13 of Decree 96/2024/NĐ-CP.
• Marital status documents (marriage certificate, certificate of single status).
• For a married transferor, a written spousal consent for the transfer is required.
• Records of paid taxes and fees related to the contract transfer.

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The 7-Step Transfer Process

The process for transferring an off-plan apartment must follow seven steps as defined in Clause 2, Article 13 of Decree 96/2024/NĐ-CP (dated July 24, 2024):

• Step 1: The transferor and transferee draft the transfer agreement based on the official template in Appendix XI of Decree 96/2024/NĐ-CP. The agreement must be in writing and contain all information required by Article 163 of the Law on Housing 2023.
• Step 2: One party submits the dossier to a notary public office located in the same province or centrally-run city as the property to have the transfer agreement notarized.
• Step 3: After notarization (unless exempt), the parties are responsible for paying all applicable taxes and fees related to the transfer.
• Step 4: After fulfilling tax obligations, one party submits the dossier to the project developer to request confirmation of the contract transfer.
• Step 5: Within 05 working days of receiving the complete dossier, the developer must review and certify the transfer agreement without charging any fees.
• Step 6: From the date the developer confirms the transfer, the transferee assumes all rights and obligations of the original buyer under the signed contract and the transfer document.
• Step 7: The final transferee in the last legally executed transfer document will be issued the Certificate of Ownership by the competent state agency in accordance with land law.

Note: If the transferor is a real estate enterprise, notarization of the transfer agreement is not mandatory unless the parties request it.

Consulting Services from Long Phan Consulting Company

Long Phan Consulting Company offers professional and reliable consulting services for transferring an off-plan apartment. Our team of real estate legal experts has extensive experience. Our services include:

• Advisory on transfer conditions for off-plan apartments.
• Legal due diligence on the condominium unit before the transfer.
• Guidance on the transfer procedure and process.
• Assistance in completing the dossier for notarization or authentication.
• Drafting and reviewing the agreement for the transfer of the sale and purchase contract.
• Consultation on tax and fee obligations.
• Authorized representation at the notary office and handling other activities until the process is complete.

With the motto “Trust for Solutions,” Long Phan Consulting Company is committed to providing fast, accurate, and cost-effective services.

>>> See more at: Consulting services for real estate for overseas Vietnamese

Frequently Addressed Topics

To clarify common issues surrounding the procedure for transferring an off-plan apartment, we have compiled the following points:

Primary Risk in Off-Plan Transfers:

The main risk relates to the developer’s capacity and legal status. If the developer faces financial issues, bankruptcy, or the project encounters legal problems preventing its completion, the issuance of the final ownership certificate to the buyer can be indefinitely delayed, even if the transfer between parties is complete.

Average Completion Timeline:

The timeline depends on the coordination of all parties. The process from notarization to tax payment and developer confirmation typically takes 10-20 working days, excluding the negotiation time between the parties.

Transfer Before Handover:

A transfer is possible before the unit is handed over by the developer. The transaction is fundamentally an “assignment of rights and obligations arising from the sale and purchase contract of future-formed housing.” It can occur anytime after the original sale agreement is signed and before the developer applies for the ownership certificate for the first buyer.

Authorization for the Procedure:

You can execute a power of attorney at a notary office to authorize another person to sign the transfer agreement and carry out related procedures on your behalf. The scope and duration of the authorization must be clearly stated.

Legal Value of Developer’s Confirmation:

The developer’s confirmation is not equivalent to an ownership certificate. It is an intermediary step that documents the transfer of contractual rights and obligations. While it is a critical legal basis for the final buyer to be named on the application for the ownership certificate, it is not the legal document that establishes ownership of the property.

Conclusion

A condominium unit without an ownership certificate can be legally transferred by following specific regulations. For professional assistance with the procedure of transferring an off-plan apartment, contact our hotline at 1900636389 for in-depth consultation and detailed pricing from our expert team.