Phnom Penh

Phnom Penh Real Estate

Phnom Penh’s real estate market stands out for its accessibility, affordability, and steady growth trajectory. According to CBRE Cambodia’s Mid-Year Review 2024, the city’s economic fundamentals remain strong, with GDP growth expected to reach 5.6% in 2024. As foreign investment continues to flow in, Phnom Penh is an attractive destination for those looking to tap into an emerging market with great potential. Demand for residential, office, and retail spaces has risen due to Cambodia’s liberal foreign ownership laws and rapid urban development.

Investing in Phnom Penh 

• Affordable Entry Prices: Property prices in Phnom Penh are much lower than in neighboring capitals like Bangkok and Ho Chi Minh City. This affordability makes the city ideal for investors seeking value without compromising growth potential. From affordable apartments to luxurious condos, the city offers properties to match various budgets.
• Favorable Investment Climate: Cambodia’s liberal foreign ownership policies permit foreigners to own freehold condominiums above the ground floor, easing access for international investors. Combined with the U.S. dollar as the primary currency for transactions, these policies create a stable environment for foreign investment.
• Growing Middle Class: The expanding middle class in Cambodia is fueling demand for residential properties, particularly in mid-range and high-end developments. This demographic shift is expected to further support property prices, while creating opportunities in the condominium and townhouse markets.
• Economic Resilience: Phnom Penh’s economy is buoyed by strong GDP growth, a steady flow of foreign direct investment, and an influx of international companies. The city’s financial outlook bodes well for continued real estate appreciation, making it an attractive destination for property investors.

Properties for sale in Phnom Penh 

The 2024 CBRE report highlights several market trends and key areas of opportunity for real estate investors. The city’s real estate market has experienced a steady recovery post-pandemic, with demand particularly strong in the condominium, office, and retail sectors.

Condominiums for sale in Phnom Penh

The condominium sector has been growing steadily in Phnom Penh, driven by demand from both local residents and expatriates. As of 2024, the city’s mid- and high-end condominium supply continues to expand, with notable demand from investors targeting long-term capital appreciation and rental yields.

• Popular Areas: Boeung Keng Kang 1 (BKK1), Daun Penh, and Toul Kork are prime locations, offering luxury and mid-range condos. These areas are highly sought after by young professionals, expatriates, and local residents alike, making them ideal for rental income opportunities.
• Rental Market: While the average occupancy rate has been recovering, new supply continues to impact rental prices, creating opportunities for investors who prioritize affordability and long-term potential.

House for sale in Phnom Penh

Long-Term Lease: Although foreign ownership of land is restricted, foreigners can lease land for up to 50 years, with renewal options. This makes long-term leases on houses and townhouses a feasible option for foreign investors looking for larger properties.

Offices and commercial spaces in Phnom Penh

With an expanding business landscape, Phnom Penh’s office market has grown significantly in recent years. Demand for Grade B offices has been particularly strong, driven by SMEs and international companies establishing a presence in Cambodia.

• Central Business District (CBD): The CBD, which includes areas like Norodom Boulevard and Monivong Boulevard, remains a key area for office space investment. These locations are popular among multinational companies and larger local businesses seeking quality office environments 

• Lifestyle Malls and Mixed-Use Developments: Projects like AEON Mall Sen Sok City and Noro Mall highlight the trend towards lifestyle-oriented retail spaces that offer more than traditional shopping experiences.

Phnom Penh real estate challenges 

While Phnom Penh’s real estate market presents many opportunities, investors should carefully evaluate the following factors:

• Property Management: Engaging a reputable property management company can be valuable for maintaining rental properties, especially for international investors.
• Financing and Transactions: Most property transactions in Phnom Penh are conducted in USD, with limited financing options available to foreigners. Investors typically rely on self-financing.
• Exit Strategy: Understanding resale market trends, buyer demographics, and market demand is essential for formulating a viable exit strategy and maximizing returns.