Feb 14, 2013 | Comments 5
Some investors now view private residential property in Cambodia as a potential source for attractive profits, reported channelnewsasia.
Industry experts believe relatively cheap private properties and the opportunity for positive returns are the main attraction for overseas investors looking to expand their assets in Cambodia.
More than 2,000 new private residential units are scheduled to go on sale in 2013, and there are plans to launch 1,000 additional units at the end of the year, according to channelnewsasia.
“After we ran in the peak during 2007, 2008 and after the global crisis, Cambodia’s [prices] dropped almost 40 to 50 percent in the property market. The price of prime residential units that used to be US$2,500 per sqm dropped down to US$1,500 to US$2,000 per sqm and now it’s increasing again, like the prime residential price has come back to US$2,000 plus,” said Sung Bonna, chairman of Bonna Group.
“Now the condominiums are starting [to increase]. Especially after 2009, our government came up with the law to let the foreigners own the condominiums, it made the demand increase. At the moment, the market for condominiums is quite good, in terms of the price, the supply is also quite good,” Bonna added.
The D I Riviera condominium project is scheduled for completion in 2015. The project is located within the Diamond Island retail destination and comprises over 700 units and its own shopping mall.
“If you compare with other countries, like Malaysia, Singapore, Thailand, I think it’s very challenging to invest in property,” said Keuk Narin, vice president of Asia Real Estate Cambodia.
“If we invest in property, like US$20,000, to buy property in Thailand, it might not be in the city centre but if you invest in Phnom Penh, it will be in the city centre and as for the value, it will be different. The capital growth is still high. And also in the city centre, in Phnom Penh especially, for the properties like condominiums, they are very good for renting. Even those like the investment, in terms of the investment it’s still very limited, five to six percent, but there’s still room for growth,” Narin added.
Returns on property investments could reach up to eight percent this year up from three percent five years ago, according to market experts.
The top property investors in Cambodia are Chinese, followed by Koreans and Malaysians.
The number of investors from Singapore is currently low, but is expected to grow steadily, reported channelnewsasia. Over 80 percent of units at the Sen Sock Town condominium project have been sold, and half the buyers were Singaporean.