Southern Vietnam residential project accepts deposits on homes without permission: authorities

Long An authorities say that a major residential area project in the Mekong Delta province has accepted deposits of VND30 million ($1,200) for each unit before it received permission to sell properties or raise capital.

The Luong Hoa Residential Area project, also called LA Home, covers about 101 hectares in Luong Hoa commune, Ben Luc district. The project is invested in by Prodezi Long An Corporation and developed by Huong Viet Investment Consultant JSC.

A series of activities have launched and introduced the project. Early June, the investor "joined hands" with many companies like Aka Homes, Era Vietnam, Dong Tay Land, EximRS, Phuc Hung Group, Phu Hoang Land, ST Housing, The One Land, Southern Homes and Purple Home to offer its products.

According to advertisements, LA Home will be a sustainable ecological urban area where residents can enjoy a harmonious and peaceful life amidst nature, but with all conveniences of urban life. The project also offers many special incentives and attractive investment opportunities.

The project is divided into six sub-areas with more than 3,750 products. Its main products are townhouses and canal-side villas, with construction floor areas of 131-234 square meters.

An early July article in the Long An newspaper mentioned that the LA Home project had officially opened for sale with prices starting from just VND2.99 billion ($119,708) per unit. The first sub-area offered for sale was LA Sol, accounting for 10% of the total area, with 375 products including townhouses, two-frontage townhouses, 18m- and 60m-wide shophouses and canal-side villas.

Townhouses were priced at VND2.99 billion ($119,708) per unit; two-frontage townhouses VND3.65 billion ($146,131); 18m-wide shophouses VND4.75 billion ($190,171); 60m-wide shophouses VND5.35 billion ($214,192); and canal-side villas VND5.55 billion.

The deposit for these products was VND30 million ($1,200) per unit with several options offered for subsequent payments.

However, provincial construction officials say that despite the massive campaign, the LA Home project has not yet completed legal procedures to raise capital and open it up for sale.

Luong Hoa commune chairman Nguyen Van Tuan said at a meeting convened on the issue that the project had the basic legal documents including authorities' in-principle approval, environmental impact assessments, 1/500 plan and construction permit. It was only stuck in the site clearance and compensation process.

However, the papers that Tuan showed at the meeting were a technical infrastructure construction permit and a permit for constructing a sports center, not the project’s construction permit.

Meanwhile, the People's Committee of Ben Luc district told The Investor that the LA Home project investor had prioritized the completion of infrastructure construction on resettlement land for affected households as well as traffic infrastructure in land areas that have been allocated and leased by competent authorities.

However, the provincial Department of Construction emphasized that the LA Home project was not eligible to transfer land use rights in the form of dividing plots for sale.

It is noted that the project is only allowed to transfer land use rights as it is a resettlement-residential area project. Its products can only be sold commercially with permission from the province’s competent authorities, the department said.

Compliance question

In September 2023, the People's Committee of Long An province decided to adjust the LA Home project from a residential area to a resettlement-residential area to serve the resettlement needs of people affected by the LA Home and Prodezi Industrial Park projects.

The decision clearly stated that the resettlement arrangement must be prioritized. Only after this work was completed could the remaining land plots be sold.

However, the investor has advertised and distributed townhouses and villas to brokerage floors for sale even before completing the resettlement component.