An expert property panel hosted a beginner’s guide to making smart investments in Phnom Penh’s condominium property sector highlighting the key considerations for potential investors to follow as well as the strong fundamentals of buying real estate in Cambodia for locals and foreigners alike.
The Making Smart Investment: A Beginners Guide presentation hosted at Factory in Phnom Penh expert included:
- Ms. Catherine Chan Founder and Executive Director Urban Village and Factory
- Mr. Alany Ly Founder and CEO of Upward Property
- Mr. Untac Nem Senior Property Advisor
- Ms. Secil Rose Dy Founder of Rose Entertainment (moderator)
1st in Asia and 4th in the World
Ms. Catherine Chan commented that Phnom Penh property was ranked #1 in Asia and #4 in the world for return on investment highlighting rental returns of 6 – 8 % and 14% annual growth according to a Huran HNWI 2018 report.
“To achieve a good return on investment location is everything when choosing a development. This is why I have decided to develop in the Southern growth district of Phnom Penh with strong government and private infrastructure projects such as the new international airport and the Kingdom’s biggest mall Aeon 3,” Catherine said.
“In addition, for international investors the Kingdom’s dollarized economy and no foreign exchange controls make the country easy for moving money. Strata titles for foreign ownership and relatively low tax fees are also key considerations,” she added.
Condominiums are a good starting point
Mr. Alany Ly singled out Phnom Penh’s condominium market as ideal for first-time investors in Phnom Penh properties outlining the large selection available in a desired location, the wide price range for different budgets as well as the lifestyle opportunities.
“Condominiums in Phnom Penh in comparison to landed property options typically offer more comfort, lower starting price, ease to maintain, and sense of community as of course strong rental returns and long-term growth on investment,” he said.
According to Alany the two main considerations when investing in a condo was choosing a growth location and only dealing with trusted developers.
“More than 20% of property buyers in Cambodia are local with China accounting for 15% and more than half are from US, Singapore, UK, Japan and Europe. Housing prices in Cambodia are still affordable compared to other countries in the region,” he added.
Seeking expert advice is a must for investors
Mr. Untac Nem spoke about the need for investors to seek quality advice from industry experts before diving into any investment as it was important to run the numbers before seeing the property adding seeking advice on the right legal process was also very important.
For those with some capital but don’t know where to start is very important to do your research first then seek a second opinion with a property agent or expert the most importantly run the numbers before seeing the property.
Untac explained that for foreigners looking to buy land in Cambodia – it was traditionally done through three main options: Cambodian nominees, a trust/landholding company, or obtaining Cambodian citizenship.
“There is various option for title ownership in Cambodia, soft titles are usually issues with the village chief however it is best to consult a lawyer first. Hart titles can be applied for and are given under the land titles office and is considered the safest form or ownership,” Untac said.
“Strata titles such as those used at Urban Village are those for buildings developed after the law was introduced in 2010. LMAP title is the newest option and is similar to hard title utilizing GPS coordinates,” he added.
Choosing developers with a proven track record
Reflecting on concerns about any potential oversupply of condominiums in the Phnom Penh market the expert panel outlined it was important to distinguish between the types of condos being sold and if it was aimed at local or international buyers.
“It is true that at the very high end of Phnom Penh’s condo market – typically aimed at international buyers – they have been a large drop in demand due to global economic headwinds and COVID restriction, especially in China,” the panel said.
“However, for those condos prices at the lower to the middle tier and targeted towards locally living buyers the demand has remained solid. The predicted increase in Cambodians migrating from rural to city living is also underpinning this demand,” they added.