Real Estate Agents in Vietnam Must Have Professional Certification

The Real Estate Business Law of 2023, effective from August 1, introduces several new regulations concerning real estate business activities, particularly those related to real estate brokerage.

Requirements for Real Estate Service Enterprises

According to Article 61 of the Real Estate Business Law 2023, enterprises engaged in real estate services, including real estate exchange services, brokerage services, consultancy services, and management services, must meet the following conditions:

1. Establishing Operational Regulations: Organizations and individuals engaged in real estate brokerage services must establish specific operational regulations to ensure service quality and conduct standards.
2. Facilities and Technical Conditions: Enterprises must possess facilities and technical conditions that comply with government regulations to support their business activities.
3. Certified Professionals: Each enterprise must have at least one individual holding a real estate brokerage certificate, ensuring the enterprise's professionalism and legality.

Before commencing real estate brokerage services, enterprises must submit their information to the provincial real estate business management agency where the enterprise is established for publication on the real estate information system. This measure aims to enhance market transparency and traceability.

Conditions for Individual Real Estate Brokers

According to Clause 2, Article 61 of the Real Estate Business Law 2023, individuals engaged in real estate brokerage activities must hold a real estate brokerage certificate and work for a real estate exchange service enterprise or a real estate brokerage service enterprise. This regulation aims to elevate the professional standards of the real estate brokerage industry, prevent unlicensed brokers from engaging in improper practices, and protect consumers' legitimate rights.

Necessity of Strict Regulations

Numerous National Assembly delegates have emphasized the need for clear conditions for organizations and individuals engaged in real estate brokerage services and for individual real estate brokers. They argue that brokers must hold a professional certificate and work within a legitimate real estate exchange platform or brokerage organization to ensure industry professionalism and legality.

Delegate Trần Thị Hồng Thanh suggested implementing penalties for individuals who operate as real estate brokers without certification and who do not work within a legitimate platform. Additionally, delegates proposed more specific and clear regulations on the responsibilities of the government and investors to ensure transparency, enabling customers to safely search for and purchase real estate.

Current Market Conditions and Issues

Presently, the phenomenon of unlicensed real estate brokers is widespread in Vietnam. According to the Vietnam Association of Realtors (VARS), there are approximately 300,000 real estate brokers nationwide, but only about 30,000 to 40,000 have undergone formal training. This means a large number of brokers in the market lack professional training, often engaging in price manipulation and deceiving customers for profit.

Phan Khánh, a real estate broker at F Group Joint Stock Company, stated that clear regulations requiring real estate brokers to hold certification and work within legitimate enterprises are crucial. The certification program includes legal regulations related to real estate, such as the Housing Law, Land Law, Construction Law, Real Estate Business Law, Commercial Law, and the Civil Code. Additionally, it covers an overview of real estate brokerage services, ethical standards, anti-money laundering regulations, transaction procedures, contract drafting, brokerage skills (price appraisal, advertising, promotion, after-sales services), and factors influencing real estate.

Impact of Unlicensed Brokers on the Market

If management of unlicensed brokers is not strengthened, it will have numerous negative impacts on the market. These brokers often use improper methods to influence market prices, resulting in unfair market conditions. Unlicensed brokers provide vague information to persuade inexperienced customers or use "bait" tactics to lure customers into making payments. Because these individuals do not bear legal responsibility, they often abandon customers after receiving brokerage fees, leaving customers at risk.

Phan Khánh pointed out that unlicensed brokers frequently exploit information asymmetry for illicit gain, potentially using regulatory loopholes to conduct illegal operations. This is unfair to licensed brokers who comply with regulations. The presence of unlicensed brokers not only affects the healthy development of the market but also harms consumers' interests.

Strictly regulating real estate brokers' professional certification and requiring them to work within legitimate enterprises is crucial for protecting customers' rights and ensuring market transparency. These measures help elevate the industry's professional standards, prevent unlicensed brokers from engaging in improper practices, and ensure market fairness and stability. Only through these regulations can the real estate market develop healthily, providing consumers with safer and more reliable services.