New Management Fee Framework for Ho Chi Minh City Apartments Increases Up to 15%

In the context of socio-economic adjustments to optimize apartment management services, Ho Chi Minh City's People’s Committee has issued a new management fee framework for apartments, effective from October 21. This framework applies to public-owned apartments under the city’s jurisdiction, as outlined in Article 151 of the Housing Law of 2023, with a minimum rate of 600 VND/m² and a maximum of 7,000 VND/m², an increase of 10-15% from previous fees. This adjustment aims to reflect the rising costs in operations, maintenance, and service provision, while enhancing transparency and effectiveness in apartment management.

The new pricing framework serves as a reference not only for public apartments but also for commercial ones, helping to resolve disputes between management boards and residents regarding fee levels. Applying a common standard will foster consensus between management and residents, reducing potential conflicts due to fee transparency issues and budget allocation. For high-end apartments with additional amenities, having a clear fee structure is crucial to meet the demand for high-quality services.

The management fee structure is divided into two categories: apartments with elevators and those without. For apartments without elevators, the minimum fee is 600 VND/m² and the maximum is 3,500 VND/m² per month, depending on specific facility conditions. This distinction highlights the difference in management costs between types of apartments, particularly regarding basic amenities like elevators, modern security systems, and specialized maintenance equipment. For apartments with elevators, the minimum fee is 1,800 VND/m², reaching up to 7,000 VND/m², reflecting the significant increase in costs associated with modern facilities. Notably, these fees exclude additional services like swimming pools, cable TV, internet, or other amenities, for which residents may incur additional charges.

Prior to this new framework, Decision 11/2018 set management fees at a minimum of 500 VND/m² and a maximum of 3,000 VND/m² for apartments without elevators. For apartments with elevators, the minimum fee was 1,500 VND/m² and the maximum was 6,000 VND/m². With fluctuations in market prices, building materials, and labor costs, this adjustment is necessary to accurately reflect actual operational costs, ensuring quality service for apartment residents.

The implementation of the new fee framework has significantly impacted apartment management mechanisms in Ho Chi Minh City. Currently, most apartments adopt a method of negotiating fees between residents and investors or service providers. This emphasizes the crucial role of transparency and reliability in negotiating service costs to maintain a stable and satisfactory living environment for residents. The average management service fee in Ho Chi Minh City ranges from 8,000 to 30,000 VND/m², with some high-end projects in District 1 charging up to 210,000 VND/m², reflecting high service quality demands in luxury apartments.

The new framework also provides a vital financial tool for investors and apartment management units for budget planning. Under regulations, investors or management units can calculate management costs using the formula: management service rate per m² multiplied by the actual usable area of an apartment or other areas within the building. This formula establishes consistency in calculations and ensures uniformity across projects throughout the city.

Furthermore, the new framework is expected to enhance transparency, reduce disputes between residents and management boards over service fees, and thus protect the interests of both residents and management entities. With a standardized fee framework, residents can easily compare and check the fees they are paying against other projects, establishing a basis for feedback and reasonable adjustments. This also protects management units from unfounded disputes and increases professionalism in apartment management.

According to the Ho Chi Minh City Department of Construction, as of May 2023, the city has a total of 1,521 apartments, including 658 built before 1994 and 807 completed since then. Managing such a large number of apartments presents a considerable challenge in maintaining service quality, especially as many older apartments require upgrades and maintenance of essential services. The new management fee framework will serve as an effective tool to help the city adjust and manage apartment buildings efficiently, ensuring that all residents have access to services commensurate with the fees paid.

The adjustment in the management fee framework not only has economic significance but also represents a commitment by the city government to improve residents' quality of life. This new framework not only facilitates the sustainable development of the real estate market but also marks a crucial step toward enhancing service quality in apartment buildings, providing a safer, more convenient, and modern living environment for Ho Chi Minh City residents.