62% in AmCham survey find real estate good investment

After being under the spell of Covid-19 for over two years, the real estate market has started to see an increase in international investors with over 62 per cent of respondents of the recent Real Estate & Construction Survey conducted by AmCham Cambodia indicating that buying property in Cambodia is a good investment now.

While making a presentation of the survey during the annual survey dinner gathering, Tom O’Sullivan, CEO of realestate.com.kh, said that over 57 per cent of the 517 respondents felt that the market is unaffordable, highlighting the opportunity in the market for developers and other stakeholders to target the lower to middle-class buyer segment.

This was further supported by over 63 percent of respondents who suggested that the industry is not doing enough to ensure properties remain affordable for all Cambodians.

Over 63 percent believed that the prices will only go up in the next 12 months as the market continues to rebound post Covid-19.

Survey participants were drawn from different segments of the population including ministries and the government sector, banks and financial institutions, the legal and compliance sector and the private sector. The latter included property managers, developers, contractors, architects, real estate agents or brokers, valuation service providers etc.

Land is the preferred investment for many with nearly 43 percent indicating it in the survey. Landed property comes next with 23.96 per cent rooting for it, while 20.83 showed preference for condominiums and 6.25 percent for commercial property. However, 6.25 percent were unsure on this.

Meanwhile, Phnom Penh remained the favorite real estate for a huge majority with 82 percent of respondents declaring so. Among the participants, 28 percent were Cambodians and 24 percent American nationals, while 46 percent represented other nationalities.

Nearly half of the participants indicated there are issues of oversupply but only in some parts of the market. However, as the country is now easily accessible again with little to no restrictions more buyers are expected to pitch in.

Managing Director of CBRE Cambodia, Lawrence Lennon suggested during the panel discussion that “While the pandemic clearly presented a tough period for businesses in general, the last two years have provided an opportunity for the market to cool and projects to be absorbed – which is one of the silver linings from Covid-19.”

To complement the AmCham survey results, Tom also presented Realestate.com.kh website traffic and survey results. These data showed that 51 percent of the real estate buyers were Cambodians, while Chinese came next at 26 percent and Americans at 23 percent. He said the Chinese buying came down from the pre-Covid-19 level of 40 percent.

The Chroy Changvar district of Phnom Penh is the favorite area for property buyers with 21 percent showing a preference for the location (up from 12.7 percent in 2017), Sen Sok 15.2 percent and Chamkarmon 13.6 percent. Toul Kork which was sought by 14.5 percent in 2017 showed a sharp decline this time to 8.3 percent and Daun Penh too went down in preference from 10.3 percent to 5.3 percent over the same period.

Tom said there are a lot of opportunities in the property market now and it is a great time to buy both for international buyers and local home buyers. “The interest in the market has particularly gone up in anticipation of the South East Asia (SEA) Games, to be hosted by Cambodia next year. The AmCham survey is also showing that the property prices can go further up in the near future,” he said.

Meanwhile, Lawrence Lennon in his presentation said the average sale price for high end condominium for the second quarter of 2022 was $2,671sqm. The average monthly rental for prime retail malls was $30.8sqm while prime condos attracted a monthly rent of $10.4sqm for the quarter.