Foreigners might be given the chance to invest in Cambodian real estate well before the creation of its stock market in 2009. With Cambodia’s economy going up and booming, it is just a matter of time before the country takes off.
The once restrictive Cambodian government is pondering policy changes that will allow foreigners to buy and own real estate outright. Currently, Cambodian law does not allow foreigners to hold land titles. Yet, an amendment to these laws is underway and could be approved soon. The shift in thinking is partly attributed to the potential opportunities that local developers see with changes to key laws. While many investors believe that Cambodia will still put restrictive provisions to these amendments, the new law will be much better than what they currently have.
The real estate market has always been open in Southeast Asia. Cambodia is following the suit of Thailand, Malaysia, and the Philippines in the real estate market. From the perspective of the Cambodian economy, this is an exciting development, since the country is given the opportunity to compete and get a piece of the foreign market that mostly consists of retirees from Korea, Japan, and the United States. This push will allow Cambodia to exceed their already record-breaking GDP growth rates.
Following the terror of the Khmer Rouge, along with the decades of conflict, many analysts agree that the boom-time abounds in Cambodia. Garment manufacturing, tourism, and real estate are the main drivers of the economy. With real estate about to take a deserving upgrade, as well as the relatively stable political situation, foreigners are seriously considering not only investing in the condominiums and gated communities in Cambodia, but also transplanting themselves and living there after retirement. Slowly, Cambodia’s reputation as a haven for foreigners is taking ground.
Still, much of the positive talk about Cambodian properties is weighed with the possibility of displacement of rural folks to make room for development. Boeung Kak, a fishing lake, is about to be drained to make room for a 120-hectare housing project. The trade off between economic growth and rural displacement is carefully being considered by Cambodian policymakers. Fortunately, there is a lot to be optimistic about the Cambodian economy.
The change in tune in Cambodia is largely driven by domestic investments. A popular theory for such massive cash inflow to the country is that a global shakeup among banks forced billions of Cambodian dollars in offshore accounts to come back home. It turns out that there are more wealthy Cambodians than first expected; this gap has encouraged money flow to real estate since there are few other investment options. These investments are slowly building momentum that allows foreign markets to follow suit. Aside from planned communities and condominiums, the Cambodian elite is promoting holiday golfing tours with the chain of excellent golf courses near the ancient Angkor Wat.
There is still a lot of guesswork left in predicting a booming economy with its rising land prices. One thing is for sure; Cambodia will turn more heads than before - this time in a good way.