The municipal government of Hanoi has asked the Department of Construction to work out a price frame for apartment services as an alternative to the current price ceiling system.
Keangnam Tower a hotbed for service disputes
The move is aimed at ending disputes between apartment owners and their management boards.
On September 29, 2011 the city government approved a plan on apartment service prices which defines price ceilings.
Apartment service prices were classified into three groups: apartments without elevators will be able to charge VND2,400 per square metre per month at maximum, apartments with 'convenient elevators' VND4,000 per square metre per month and apartments equipped with limited elevator service can charge VND3,100 per square metre per month.
Since then the number of disputes has been on the rise, and the situation has come to the point where an investor has threatened to hand over management of buildings to the municipal government.
The Vice Chairman of Hanoi People’s Committee Nguyen Huy Tuong has asked the municipal Department of Construction to co-operate with relevant agencies to hold a seminar on building and managing apartment service prices.
Previously the department proposed that the Ministry of Construction set prices apartment services instead of issuing ceiling prices or a price frame.
According to the ministry, prices of all services at apartments, including parking fees, should not be allowed to surpass the prices defined by municipal and provincial governments.
Municipal and provincial governments are responsible for defining ceiling prices or price frame for services for different types of apartments.
The ministry pledged to take into account proposals by Hanoi authorities on difficulties in managing apartment service prices based on ceiling prices.
It will gather more information on the issue in some other localities before making a proposal to the Government to amend Decree No. 71, detailing the implementation of the Law on Housing.
While waiting for the amendment, the municipal government should require related individuals and organisations to publicly and transparently define apartment service prices, the ministry added.