DISPUTES IN RESIDENTIAL: THE LAW HAS BEEN BUT NOT IMPLEMENTED

DISPUTES IN RESIDENTIAL: THE LAW HAS BEEN BUT NOT IMPLEMENTED

27/06/2019 00:06|INDUSTRY NEWS

Cungcau - The management documents of apartment buildings such as Regulation 08, Circular 02, Housing Law ... all have been clearly stated, but why are disputes still increasing?

 

Cannot keep up

 

On June 25, the Vietnam Investment Review cooperated with Venus Investment and Services Joint Stock Corporation to hold a seminar "Operating multi-ownership real estate: Finding an agreement".

 

Speaking at the opening of the seminar, Mr. Le Trong Minh, who is the Editor-in-chief of the Vietnam Investment Review, said that Vietnam is one of the most rapid urbanization countries in the world. Until the end of 2019, the rate was forecasted to reach approximately 40%. Additionally, by the 40s of the 21st century, about 50% of the Vietnamese population would live in urban areas.

 

 

That is one of the reasons why the model of multi-ownership real estate, especially condominium and urban projects, is increasingly prevalent in our country.

 

By the end of 2018, there were about 4,400 apartment buildings across the country with hundreds of urban and low-rise housing projects. In particular, the two largest cities are Ho Chi Minh City has about 1,440 apartments and Hanoi has about 1,100 apartments with millions of people living.

 

Not only had become one of the most exciting segments in the real estate market for many years (with tens of thousands of apartments sold each year), an industry that manages and operates multi-ownership buildings had also started to form with hundreds of service providers inside and outside the country participating in the business.

 

However, in the process of forming, managing and operating those recent projects, many issues occurred. These problems did not only negatively affect the real estate market and market participants, it also risked causing instability in the social order.

 

Mr. Le Hoang Chau, Chairman of Ho Chi Minh City Real Estate Association (HoREA), said that Ho Chi Minh City accounted for about 1/3 of the total 4,400 apartments of the country. Before 1975, Ho Chi Minh City had 474 apartments and all of them had only 4 or fewer floors with no elevators. Regarding the dispute data, the current dispute rate according to the Ministry of Construction is around 10%, there are many types of disputes.

 

In 2008, the first decision was the legal basis for condominium operation, then the Housing Law 2014, Circular 02, 2016, 2018 and a revised circular.

 

Thus, regarding the operation of condominiums has been very specific regulations. However, HoREA realized that the current law has not kept pace with the development of the city.

 

Currently, Ho Chi Minh City has a very high rate of urbanization. Thus, the trend of living in apartment buildings is inevitable and there will be a very large part of restructuring residents from low-rise to high-rise.

 

According to the Housing Law, an apartment without an elevator is not required to hire a professional operating management unit. However it is required if there is.

 

By law, the Board of Directors was established by the Apartment Building Conference. It had a legal entity and worked like a cooperative model. However, this model had a lot of controversies when it did not show its role in representing the residents, raising the voices of residents and had exposed it deviations in finance management.

 

Complex disputes include maintenance fees. Current regulations, 7 days after the conference to hand over maintenance costs, resulting in not handing over or not handing over.

 

The reason is because the law has flaws. The maintenance fee is used to maintain the structure, so the handover is easier. However, the law states that the maintenance fee must be used for the mechanical and electrical system, which is jointly owned but quickly wear down.

 

Normally, if this mechanical and electrical equipment is appropriately invested, it will be rarely damaged. Even if it is broken, it will also have the warranty of the suppliers and after the warranty period the story is maintained and repair.

 

“I am not saying whether the use of maintenance fees should be for the shared mechanics or just for the structure that I want to talk about the need to specify how to collect, manage and use the maintenance budget. how to show respect to the rights and interests of residents and investors, use management in accordance with the decision of the owner” Mr. Chau said.

 

HoREA's chairman also added to his statement: “The most important thing is separating the revenue and expenditure will help prevent disputes”. We know that the first level apartment with 20 floors or more has reached over 20 billion VND. Compared to an established enterprise, maintenance funding is very large, so it is not strictly controlled, it is very likely that disputes are likely to occur, so the apartment dispute is a lot.

 

In terms of benefits, each side has reason to think about the maintenance fund story, however, due to a large amount of money, there are sometimes different understandings and ways of thinking about maintenance funds. 

 

In fact, at present, we also have to admit, in addition to the reason that the investor's goal of keeping the maintenance fund, is not to deny that the management said that it had the legal status, but actually made a seal. for administrators is not easy. The fact that the Board of Directors has not really recognized leads to the struggle and decision of the Board of Directors when there is a problem from the investor is not really easy. The association has worked with the Ministry of Construction, but still cannot handle it.

 

Explaining the causes of apartment disputes, Ms. Vu Ngoc Huong, General Director of Venus Investment and Services Joint Stock Company (Venus Corp.), an enterprise specializing in operating and managing projects The multi-ownership real estate said that the reason is because some investors do not have sufficient financial capacity and focus on profits so they do not open separate accounts to manage and delay the handover of maintenance funding to management. treatment.

 

“Some homebuyers do not scrutinize the terms of the contract, in which the investor makes the benefit to himself. Some members of the Management Board have little professional experience, the role of local management is not good” Ms. Huong said.

 

According to Huong, looking at the surface of the incident, the management of apartment buildings seemed to be simple manual jobs such as receptionist, security, sanitation, garbage collection, insect treatment, and sanitation. squirrel trees ... but the deeper you go to see this is a challenging field, with countless difficulties facing each day, but each type of real estate has a different management process and service requirements.

 

The lack of professional knowledge of management, as well as the lack of preparation of operational management tools,  is one of the causes of the dispute in apartment buildings, office buildings ... It is very common, from private ownership disputes to management fees, associated services such as landscape greenery, garbage collection, protection…

 

Hard to enforce

 

Ms. Vu Ngoc Huong adds, the apartment model usually maintains stable operation for the first 3 years. Nevertheless, the following years often occur disputes.

 

The cause of the dispute comes in part from the lack of legal provisions; the investor, the customer does not consider the terms of the contract;management expertise; management role of the locality...

 

The common disagreements are the slow organization of the apartment meeting, the unification of the management unit, the slowing out of the pink book, or the information that residents receive does not match the information of the investor. should lead to a dispute.

 

Operational management is quite young since 2005, this phrase was introduced in the Housing Law. Then, the Decision No. 08 of the Ministry of Construction is considered as the legal foundation for housing management. Up to now, the legal aspect has been relatively complete, but there are still many shortcomings in practice.

 

Besides from the advantages such as easy market, management and assistance from the government, there are lots of difficulties such as this is a new industry, the human resource has not been specially trained, service standards are not clear, service market is very primitive, mechanism of operation is not smooth, people's awareness is not positive, legal loophole ...

 

The question is how to operate the apartment better? According to Huong, the first thing to do is to improve the legal corridor, promoting communication and legalizing support. Because when the customers lack information, they will wonder and perform incorrectly ...

 

The next essential thing is to make customers understand the rights and responsibilities of each resident. Next is to encourage the implementation of smart city building, make the operational management a bit smart, make things safer.

 

Moreover, it is advisable to tighten operation management by setting service standards, perfecting service delivery standards processes, and applying information technology in management.

 

From the perspective of the insider, Mr. Dinh Van Su, Head of Management Board of Hoang Anh An Tien apartment, realized that the documents of state management on apartment buildings, from Regulations 08 to Circular 02, The Law of Housing ... is both an energy and a constant logic.

 

The problem lies in how it is implemented, it is related to the state management work here. For example, in the dispute on maintenance costs, in the Housing Law 2014 provided for in Articles 108-109, Circular 02 also clearly states in Articles 36-37 and sanctions on failure to hand over maintenance funds have been contained in Decree 99/2015

 

“Look around Ho Chi Minh City, is there any coercive decision of the investor to the Management Board or not? The regulation states that the provincial People's Committee issues a coercive decision within 30 days of receiving the written request from the board. How many coercions are currently being made?”, Mr. Su said.

 

 

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