Investing in Cambodia Real Estate

Why Invest In Property In Cambodia?

Cambodia has emerged as one of the fastest-growing economies in Southeast Asia, with an average annual GDP growth of over 7% in the past decade. This growing economic landscape presents Cambodia as the next up-and-coming destination for property investment. From the bustling streets of Phnom Penh to the historic wonders of Siem Reap, investors are welcomed into a market ripe with affordability and investment potential. With the government’s continuous support on development and foreign investment, Cambodia is rapidly emerging as a prime destination for investors looking to tap into the heart of Asia’s growth story.

Affordability

One notable advantage of Cambodia’s real estate market is its affordability compared with other countries in the region. Property prices in Cambodia are significantly lower, making it an attractive investment option for those seeking good value for their money.

High Rental Yields

Investors in Cambodia also benefit from relatively high rental yields compared with neighbouring Southeast Asian countries. This means that property owners can expect a favourable return on investment through rental income.

Read: Condo Ownership Journey in Cambodia

Government Support

The Cambodian Government actively supports property development and direct foreign investment. It has implemented progressive legal frameworks, tax incentives and financial advantages to encourage investment in the country. This proactive approach has resulted in positive outcomes that are stimulating the property market, attracting foreign investment, generating employment opportunities, enhancing infrastructure and boosting tax revenues.

Political Stability

Political stability is another key factor that makes Cambodia an appealing destination for property investment. The country has enjoyed a stable political environment under the same ruling party since 1979, minimising the risk of civil unrest or instability. This provides a secure and reliable environment for property investors.

Average GDP Real Growth Rate by Country 2013 To 2023

Booming Tourism Industry

The burgeoning tourism industry in Cambodia further drives the demand for properties, especially in popular tourist areas like Phnom Penh and Siem Reap. The influx of tourists creates an opportunity for property owners to capitalise on the growing demand for accommodation.

Infrastructure Development

Cambodia’s commitment to infrastructure development, including highways, airports and seaports, is enhancing connectivity and making the country even more appealing to investors. Improved infrastructure facilitates business growth and attracts both domestic and international investors.

Inflation Rate by Country 2023

Young Demographic And Middle-Class Growth

With over 60% of its population under the age of 25, Cambodia boasts a sizeable youth demographic. This represents a significant pool of potential property buyers and renters, ensuring a steady demand for properties in the long term.

Additionally, Cambodia’s expanding middle class, fuelled by robust economic growth and increased job opportunities, has resulted in a rise in disposable income. This growing middle class is investing in housing, automobiles and various goods and services, further driving the demand for properties.

When you consider all these factors, it is evident that Cambodia offers exceptional property investment opportunities. Investors, not only in Southeast Asia but globally, are recognising the kingdom’s potential, making it a prime destination for property investment.

A Strategic Investment: Exploring Condominiums In Cambodia

Cambodia’s steady and impressive economic growth has made the country’s real estate sector, particularly condominium investments, an attractive prospect for investors worldwide. In this section, we explore the many benefits to purchasing a condo in Cambodia as a foreign investor. Some of the most notable benefits include:

Affordability

Cambodia is one of the most affordable countries in Southeast Asia, and this is reflected in the cost of real estate. Condos in Cambodia can be purchased for a fraction of the price of condos in other countries in the region. Refer to the graph below.

Average cost/m2 to purchase inner-city condos (2023)

The Right To Own A Property

Under Cambodian law, foreigners can legally own condominiums under a strata title. This means that you will have the legal right to enjoy 100% ownership of your condo and use it as your primary residence or as a rental property.

Read: Can Foreigners Own Land in Cambodia? Here’s How.

The Right To Transfer Ownership

You can freely transfer ownership of your condo to another person, whether they are a foreigner or a Cambodian citizen. This makes it a good investment, allowing you to sell your condo for a profit in the future.

Growth Potential

Cambodia’s economy is growing rapidly, and this is leading to an increase in demand for real estate. Condos in Cambodia have the potential to appreciate considerably in value over time.

Rental Income

Condos in Cambodia can be rented out to tenants, providing a steady stream of income for investors. The rental market in Cambodia is very strong and there is a high demand for rental properties. See the graph below:

Average Gross Rental Return Per Annum for Inner-City Condos (2022-2023)

Tax Benefits

There is currently no capital gains taxes on residential property sales in Cambodia. This means that investors who sell their condos at a profit will not have to pay any taxes on the sale. A capital gains tax of 20% of the profits has been delayed by the Cambodian Government for the 3rd time until end of 2024, and is most likely to be delayed again due to the government’s desire to support economic growth in the post-pandemic era.

Visa Benefits

There are several types of visas for foreign investors in Cambodia that come with their own advantages, contributing to an investor-friendly environment, attracting foreign capital, promoting economic growth, and facilitating the establishment and success of business ventures in the country. Obtaining visas in Cambodia is currently much easier and less restrictive than some of its neighbouring countries in Southeast Asia.

The Right To Mortgage Your Condo

You can use your condo as collateral to obtain a mortgage from a bank. This allows you flexibility to manage your property portfolio to achieve your other financial goals.

The Right To Inherit Your Condo

In the event of your demise, your condo will be transferred to your designated heirs in accordance with your will. This ensures that your family retains ownership of the condo even if you are not a Cambodian citizen.

For an in-depth look at current market performance and key projects, read our latest feature: Why Invest in Cambodia: Asia’s Most Underrated Property Market