Risk Prevention When Buying Land Without a Certificate of Ownership in Phu Quoc

Risks When Buying Land in Phu Quoc Without a Land Use Rights Certificate

Buying land in Phu Quoc without a Land Use Rights Certificate (also known as a “Red Book”) often carries significant risks because such land is not protected by law. To protect our clients and those interested in Phu Quoc real estate, we have summarized the main risks in the following article for investors to understand and avoid.

1. Buying land without a Land Use Rights Certificate in Phu Quoc is not protected by law

Land use rights are recognized only when the land user is issued a Land Use Rights Certificate. This is a prerequisite for conducting land transactions such as buying, selling, gifting, or inheritance.

Article 188 of the 2013 Land Law states that one of the conditions for transferring land use rights is that the land must have a Land Use Rights Certificate (except in some special inheritance cases).

Therefore, if you buy land without a certificate in Phu Quoc, the transaction will not be legally protected. The rights of buyers and sellers will be significantly affected, and many risks will arise from transactions without this condition.

2. Common risks when buying land without a Land Use Rights Certificate in Phu Quoc

Investors buying land without a Land Use Rights Certificate in Phu Quoc may face the following basic risks:

2.1. Sales contract not notarized
According to Article 40 of the 2014 Notarization Law, without a Land Use Rights Certificate, the land is not legally recognized. Sales contracts for such land cannot be notarized, and all transactions lack legal safety.

2.2. High risk of land disputes
Land disputes frequently occur in Phu Quoc. Buying land without a certificate means the investor loses many ownership rights, making them vulnerable. Even certified lands can be disputed, so uncertified lands carry even higher risks.

2.3. Risk of overlapping with forest land boundaries
There are many plots of land bordering forest areas in Phu Quoc, which are not issued certificates. Buying such plots risks land confiscation without compensation for violating land laws.

2.4. Risk of “fake” investments
Many uncertified lands are sold through handwritten contracts. When the land price suddenly rises, sellers or brokers may cancel the contract (“flip sides”). The investor may get back their deposit but must return the land, losing out on the appreciated value.

2.5. Difficulty verifying land origin
It is impossible to determine the exact owner, boundaries, or if the land is subject to zoning or confiscation, creating significant risks in verifying land origin.

2.6. Cannot mortgage for bank loans
According to Article 188 of the 2013 Land Law, only land with a certificate can be used as collateral for loans. Therefore, investors should buy land with certificates for better financing options.

2.7. Difficulty reselling or conducting further transactions
As explained, buying uncertified land is illegal and risky. Avoid trusting brokers or sellers with tempting offers for uncertified land to prevent dead investments or losses.

3. Choosing reliable consultants and transparent real estate products

The above risks can occur when buying land without certificates in Phu Quoc. For safer investment, we recommend choosing land with Land Use Rights Certificates.

Additionally, many other risks may arise. Thus, investors should select reputable real estate consulting units to ensure purchasing legitimate, transparent, and reasonably priced land plots.

For more in-depth advice on Phu Quoc land, investors can contact us at Phuquoc.net.vn. Our large team on the ground will guide investors to visit land plots in reality for the most accurate view.