Condo boom in Cambodia's capital driven by expat demand and a leap of faith

[geovalin]

By Prak Chan Thul and Aradhana Aravindan

PHNOM PENH/SINGAPORE, Nov 3 (Reuters) - High-rise apartments are springing up across Cambodia's capital, part of a property boom led by expat demand, while developers are also betting the country's growing middle class will shed a traditional distaste for "living on top of each other".

As once red-hot property markets like Singapore lose steam, frontier markets such as Cambodia are gaining more attention from investors, and that is helping make the construction and real estate industries the Southeast Asian nation's most dynamic engine of growth.

Developers such as Singapore's Oxley Holdings and Teho International are embarking on high-rise upmarket condominiums complete with swimming pools, gymnasiums and river views. Japan's Creed Group as well as Taiwanese and South Korean firms have jumped into the market, while local developers are also building, albeit mostly low-rise apartments.

A lack of condominiums in prime Phnom Penh areas for expats has led to high rental yields for investors. But some experts worry supply could outstrip demand in a few years unless the country's middle class moves away from a traditional preference for houses with land.

With an economy of only $16.7 billion, Cambodia could be very slow in shifting to high-rise living as its urban middle class, while growing, remains small.

"Unless there is a strong take-up by local families, there could well be an oversupply," said Marc Townsend, managing director for real estate services firm CBRE in Cambodia and Vietnam.

Property consultants note that most buyers of condominiums, even locals, are purchasing them for investment purposes - keen to rent them out and believing their value will appreciate over the next few years.

They also estimate that foreigners account for 60 to 70 percent of condominium sales in Cambodia, spurred on in part by the relaxing of restrictions on foreign home ownership in 2010, though some limitations remain in place.

"While most buyers are foreigners, the trend will change towards Cambodians. But it may take 10 to 20 years," said Kim Heang, chief executive of Khmer Real Estate.

Full story: http://www.reuters.com/article/2015/11/02/cambodia-condominiums-idUSL3N12N3UL20151102

-- Reuters 2015-11-03

[phantomfiddler]

I see they allow a lot more foreign ownership than the ridiculous 49% limit set by this bunch of numbskulls ? Don,t they realize that we can,t take it away ?

[honcho]

news flash... there is already an over supply..... I guess they keep on building in some kind of laundering of their ill gotten gains....

[GOLDBUGGY]

They want $300,000 for a 3 bedroom condo?

Well, that might be cheap in London or New York, but for Cambodia that doesn't sound too cheap to me. I think you could do much better than this in Pattaya, and more attractions their to. I had a nice visit when I went their, and enjoyed myself. But to live their at these prices???

[flyingdoc]

Sounds expensive !