I was recently discussing with some people, as we do here in the expat community, about how happy they are with their condos or houses and who much they pay for them. Rent is pretty low here in Vietnam for reasons that I can only speculate about, but the average wages of a Vietnamese person is substantially lower than a foreigner's is. Again, there are a lot of reasons why this is the case and it is NOT because foreigners are smarter than Vietnamese people are.
Not long ago one of the few Vietnamese people that hangs out in my crew was participating in the conversation and she was kind of laughing at how much we all pay for rent. Not in a sort of evil way, but just that she thought it was absolutely crazy that anyone would pay that much to rent a 1-bedroom condo and how for the kind of money that we were talking about, she could easily find a 5-bedroom furnished house.
I was curious so I asked a bit more about how this is possible and if she would be willing to "work for me" as a condo/house finder and I would give her a finders fee of several hundred dollars if she was able to find me something that was a great value or a deal of a lifetime, in a way.
Her answer was "no" and it wasn't because she doesn't want to help me, it is because she can't.
src
The above picture is a stock image and I have no idea where it is. If you were to find a place like that here in Da Nang it would easily cost at least $1500 a month and while that might sound like par for the course in the western world, this is outrageously high for here in Da Nang. However, a Vietnamese person would pay at least half that much for the same exact unit and it isn't because of some sort of evil "lets take advantage of the stupid foreigners" plot. It is a legal thing, actually a required thing for all property owners that is designed to protect the local Vietnamese people from being priced out of the market in their own country.
Now I have no idea if this is true everywhere in the country, but I spoke to my paralegal / visa agent and asked him about this and said that it is a law here in Da Nang, which is one of the most popular places for expats to reside anywhere in Vietnam and dare I say, all of SE Asia.
The way it works is that when a person builds a condo unit or a house that is intended for rental purposes, they must apply for a license to rent it and there are two kinds of licenses that they can get.
- one that is intended for local people that is so close to free that is isn't even worth mentioning the cost
- one that is intended for foreigners which is really expensive
For many condos, including the one that I am in, because of their proximity to the ocean, they opt to obtain the expensive license that is meant to house foreigners. This is because the average Vietnamese person doesn't really care about living close to the ocean I guess, I can't really say for sure. But there is no denying that people who have decided to have a "home away from home" are far more interested in living near the natural wonders the area has to offer.
There are, however, apartment blocks here in our vicinity that are meant to be Vietnamese only. The girl that was privy to our conversation lives in one of these units and I went with her to look at her room one day. Don't get excited, there was no hanky panky involved, it was an innocent viewing of sorts.
Her 1-bedroom condo was essentially exactly the same as my own. If anything, it was a bit larger and slightly nicer but a lot of that has to do with how much effort she puts into keeping it nice and well, while I am not a slob I put much less effort into such things.
My rent in a condo that is more or less exactly the same as hers is 12 million VND a month which is about $470.
Her condo is 3.5 million VND which is about $135.
Her building doesn't even allow foreigners to live in the building and this includes people who are in relationships. She has a foreign boyfriend but he is not so much as allowed to stay with her. She later told me that by me simply walking into the building with her, that she got a phone call from the owner asking what I was doing there. This might be some sort of prevention of unauthorized brothels as well (there is no such thing as an "authorized one" legally speaking) but the point here is that the owners of the building take this sort of thing very seriously and would get in very serious trouble if they were to attempt to circumvent the system by purchasing "local only" licenses but renting to foreigners.
I think this is a very good method of protecting the local population and I am totally in favor of it. If we didn't have this system, the girl that I know who works as a local bartender for something crazy like $2 an hour, there would be nowhere that she could afford to pay rent in this area at all. Because of the system, the owners of a building have the option of choosing which market they are going to cater to. I spoke to my own landlord and said that she has 80% foreign licenses and 20% Vietnamese licenses and there is no way in hell that she would ever violate this rule because if she were caught doing this, the government would shut down her business immediately, and she could be facing possible imprisonment.
While Vietnam appears to be a rather lawless place in the way that you don't see officers walking around harassing people, the laws here are quite strict in certain ways. They have their own methods of enforcing things and a lot of it, apparently, are "snitch incentives" where a local who isn't even in law enforcement could tip off the police and get a cash reward for doing so.
So this is kind of nice to know because sometimes as a foreigner you get concerned that you are getting ripped off on a lot of things but in this case it isn't a ripoff, it is a very effective way of not screwing over your own population.
As much as I hate to praise communism, this actually works very well.