Some limitations in land valuation methods used in calculating compensation and suggestions for improvements

Abstract

The article sheds light on the theoretical and practical issues of land valuation when the State acquires land by clarifying the criteria of land valuation methods that calculate compensation using market value. Compared to land valuation in other fields, land valuation in land acquisition is a unique legal institution involving both administrative and civil relations in determining the market value of the land. Therefore, there is a need for a legal mechanism that not only ensures the objectivity of market-based valuation techniques but also ensures administrative feasibility. Thereby, the article: 1) points out some appropriate methods in determining the land price for calculating compensation in land acquisition; 2) proposes solutions to ensure the accuracy of the database on land in Vietnam; 3) proposes changes in the approach of Vietnamese contract law on the legal effect of “sham” transactions to promote transparency of the land market in general and real estate market in particular; and 4) provides suggestions regarding mechanisms to ensure feasibility of the legal framework on determining the land price for compensation based on administrative-civil relations.