Land valuation has long been one of the most challenging aspects of implementing Vietnam’s land legislation, with direct implications for State budget revenues, project timelines, and the livelihoods of residents affected by land clearance.
Speaking at a July 7 seminar entitled “Valuation in Land Management and Use: Current Situation and Solutions,” organized by the State Audit Office of Vietnam (SAV), Mr. Bui Quoc Dung, Deputy Auditor General, said land is a vital national resource, serving as a fundamental production asset, a platform for development, and one of the country’s most valuable public assets.
Recent legal reforms and related regulations, he continued, have created a more transparent and market-oriented framework for land valuation, while strengthening decentralization and accountability.
He noted that new regulations took effect on July 1, requiring that land prices be adjusted according to different land categories and local conditions, which has significant implications for government agencies, local authorities, and businesses.
Against this backdrop, Mr. Dung said the SAV aims to use audits to improve policies, strengthen State management, prevent corruption, and help businesses and citizens comply with the law.
Implementation hurdles
Mr. Vo Anh Tuan, Deputy Director of the Department of Land Management at the Ministry of Agriculture and Environment, said land prices are central to calculating land use fees, land rents, auction reserve prices, compensation, and other financial obligations. Inaccurate valuations can therefore result in lost budget revenues, disputes, project delays, and inefficient land management.
Replacing the land price framework under the Land Law 2024 with annually updated provincial land price lists, he added, is a major step toward aligning State-set prices with market values. While local governments have begun implementing the new system, challenges remain, including limited market data, shortages of experienced valuation officials, an insufficient number of qualified valuation firms, and reluctance among some consultants to undertake specific land valuation assignments.
Mr. Pham Van Binh, Deputy Director of the Price Management Department at the Ministry of Finance, said the biggest obstacle remains the lack of reliable market data. Though Vietnam’s real estate market has expanded rapidly, databases on land and property transactions remain incomplete, fragmented, and insufficiently transparent. Transaction values recorded in notarized contracts or tax declarations often fail to reflect actual market prices, while data held by tax authorities, land registration agencies, notary offices, real estate exchanges, and financial institutions remain scattered with no effective data-sharing mechanism.
Land valuation is further complicated by the unique characteristics of each property, Mr. Binh noted. Differences in land use, planning, infrastructure, legal status, commercial potential, and development prospects make it difficult to identify comparable assets, particularly for large-scale projects such as industrial parks, commercial developments, hotels, hospitals, and schools.
He also highlighted incomplete legal documentation for older properties, limited data on construction and replacement costs, and the uncertainties associated with the residual valuation method, which depends heavily on assumptions about future revenues, investment costs, project timelines, and market conditions.
In addition, valuers must navigate an evolving legal framework covering land, investment, construction, real estate, taxation, and public assets, while Vietnam has yet to establish a comprehensive national land and property database. The use of AI, big data, geographic information systems (GIS), and automated valuation models (AVMs) also remains at an early stage, leaving much of the work dependent on manual data collection and professional judgment.
“These challenges affect not only the quality of valuation results but also the implementation of investment projects, public asset management, bad debt resolution, judgment enforcement, and legal proceedings,” Mr. Binh added.
Local challenges
The challenges identified by ministries are also being felt by local governments, including Khanh Hoa and Gia Lai provinces.
Mr. Cao Thanh Thuong, Director of the Gia Lai Provincial Department of Agriculture and Environment, said the newly-expanded Gia Lai province spans coastal, highland, and mountainous areas with vastly different land markets, exposing weaknesses in all three principal valuation methods.
Under the comparison approach, the widespread practice of declaring different prices in notarized land transactions continues to undermine reliable market data. In many mountainous areas, where few transactions have taken place in the past two years, finding comparable properties is often impossible, leaving adjustments heavily dependent on professional judgment.
The income approach can also produce distorted results because land values are tied to the financial performance of nearby businesses. Profitable businesses can inflate valuations, while loss-making operations may even result in negative land values, requiring authorities to fall back on official land price lists.
For the residual approach, Mr. Thuong cited two key challenges: estimating future project revenues in illiquid markets and relying on construction cost benchmarks that often lag market conditions. Though investor-prepared cost estimates may be independently reviewed, they are not verified by State agencies, leaving room for disputes. He noted that post-audit findings frequently focus on these assumptions.
A representative from VALID Valuation Co., Ltd. said another growing concern is consultants’ reluctance to take on land valuation work because of legal risks. Recent prosecutions involving valuation firms have made many consultants wary of accepting large projects, particularly while the concept of land prices being “close to market value” remains open to interpretation.
The firm also noted that valuations often take longer than expected because consultants depend on information from multiple agencies, while service fees remain low despite significant professional responsibility. At the same time, there are no clear legal safeguards for consultants and appraisers who fully comply with prescribed valuation methods and procedures.
Calls for comprehensive reforms
To address these bottlenecks and create a more effective land valuation system that balances the interests of the State, citizens, and investors, VALID proposed four key reforms.
First, it called for accelerating the development of a national land information database by requiring all real estate transactions to be digitized and disclosed through property exchanges or the banking system.
Second, the company recommended introducing clearer criteria and acceptable margins of error for valuation methods, particularly the residual approach. It argued that land valuation is an estimation exercise and should not be expected to deliver the mathematical precision of an exact calculation.
Third, it proposed establishing legal safeguards for appraisers and consulting firms. Where consultants have fully complied with legal procedures and relied on objective information available at the time of valuation, their conclusions should be respected and protected.
Fourth, VALID called for streamlining procurement procedures for valuation services by simplifying the selection of consultants through direct appointments or shortlists of pre-qualified firms, helping accelerate project implementation.
Better coordination
Representatives from local authorities urged central agencies to accelerate the development of a national land price database, address the persistent problem of dual pricing in land transactions, standardize key assumptions used in the income and residual approaches, and strengthen the accountability of valuation consultants.
They also called for closer coordination between local governments and the SAV to establish consistent interpretations of regulations when market data is incomplete, giving local authorities greater confidence in making land valuation decisions.
In addition, they proposed assessing officials’ accountability based on compliance with the laws and procedures in force at the time of valuation, while distinguishing procedural violations from legitimate differences in professional judgment or subsequent market fluctuations.
Drawing on audit experience across numerous localities, representatives from Regional State Audit Office No. VIII said land valuation is a multidisciplinary process that requires balancing legal, planning, financial, market, and technical considerations, making close coordination between government agencies, consultants, and other stakeholders essential.
The office said improving land valuation will require stronger cooperation between authorities and consulting firms, while the SAV will continue using its audit findings to recommend legal and policy reforms. “This will help improve the effectiveness of State land management while ensuring that land resources are managed and utilized in a more transparent, efficient, and sustainable manner,” an SAV representative said.
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