Property of the week

Thu, 19 January 2012 Yi Somphose Located on the bustling Street 51 in Boeung Keng Kang 1, this stylish apartment block offers the best in city living, fusing traditional Khmer design with modern Western-style amenities. The block, named Motanak, which translated means proud, opened its doors in 2007. It comprises 17 units set over six floors. Each unit is fully-furnished, with plush furnishings and all necessary white goods. The current rates for the one, two and three-bedroom units are US$1,200, $1,500 and $2,800 respectively. All utility bills are included in the rent, with electricity usage the exception. The apartments are extremely secure, with 24 hour security and CCTV present. Read Original...

Value of construction approvals doubles in 2011, as demand slowly returns to the market

Thu, 19 January 2012 Soeun Say The value of construction approvals granted by the government authorities more than doubled in 2011, compared to the previous year, according to official figures obtained by the Post. Some 2,129 potential projects worth US$1.7 billion were given the green light last year, compared with 2,149 construction projects worth $840 million approved in 2010, according to the Ministry of Land Management, Urban Planning and Construction. The ministry’s Construction Department Director Lao Tip Seiha said that the ministry had improved an increasing number of larger developments, such as housing developments, industrial developments and tourist facilities, last year. “We saw increases in the construction sector in the Kingdom’s three major economic hubs of Phnom Penh, Siem Reap and Sihanoukville,” he said, adding that larger construction projects were approved with a higher value. Capital investment in the sector continues to increase as a result of political stability and the Kingdom’s safe investment environment, he said. “I believe the construction sector will grow in the next few years, as foreign investment returns to Cambodia.” With the subsidence of the economic crisis and the optimistic outlook of the property sector, other experts believe it is the right time to resume construction of stalled housing developments. “Demand returned to the market in 2011. It’s now time for developers to restart construction projects after three years of economic downturn,” said Chrek Soknim, deputy director of property agent V Trust Property Co. He added that the bourgeoning banking sectors increased provision of home loans would boost the real estate sector. Previous figures from the Ministry of Land Management, Urban Planning and Construction...

Property tax collection exceeds expectations

Thu, 19 January 2012 Seun Son Collections from the recently implemented property tax have exceeded government expectations by double, according to government officials. The tax collection on properties, including land and property, has hit US$12 million since the law was passed, according to Om Chorn, deputy general director of the taxation department at the Ministry of Economy and Finance. “We expected to collect about US$6 million in revenue from the tax through 2011, but the estimate doubled,” he said. The surprise increase on the estimate was due to a raised awareness of how to pay the tax, he added. The collection was conducted in 113,885 sites throughout the Kingdom according to data obtained from the tax department “I think the law will help increase the state income, and because it’s the first tax payment of its kind, will introduce a tax culture,” Om Chorn said, adding that the majority of property owners had now paid the tax. The law, which was twice delayed due to a lack of government resources, was formally implemented in 2011 and concluded on December 31, last year. It applies to properties worth $25,000 an above, with owners required to pay 0.1 per cent of the properties value. Some experts believe that while the tax will benefit the Kingdom’s economy, many proprietors are unhappy with the new law since it came into effect. “Although people are upset, they can not avoid paying required tax,” said Chheng Kimlong, business and economics lecturer at the University of Cambodia. However, some issues do remain with the law. In some cases, two similar properties have received different valuations, he...

A turning tide in the city by the sea

Thu, 12 January 2012 Liam Barnes {jathumbnail}For many in the region, the mere mention of Sihanoukville evokes images of seedy, carbon-copy bars and budget guesthouses, packed with booze-fuelled western tourists after a cheap fix of sun, sand, sea and maybe a little something more. However, a number of recent developments could change the face of Cambodia’s newest city, paving the way for a potential influx of investment and a surge in the property market. One of the main factors behind the newfound optimism in the seaside city is the re-launch of Sihanoukville Airport, with local Carrier Cambodia Angkor Air running regular flights from the Kingdom’s largest tourist destination Siem Reap. The south coast has also received international attention after entering the coveted World’s Most Beautiful Bay Club. The expected increase in tourism will see the city emerge as an ideal investment destination, particularly at the higher-end of the market according to CBRE Indochina Chairman David Simister. “Outside the industrial and agricultural sectors, the single easiest way to increase foreign revenue and drive the country forward is to connect the south coast beaches with the tourist market of Angkor,” he said, adding that most visitors to Angkor Wat are on a five-star level, but struggle to find appropriate accommodation in Sihanoukville. “It’s a push-pull situation, hotel investment is waiting for the airlift and vice versa, but at least that’s started. It’s very important the Cambodian government ensures this connectivity continues to grow.” Simister highlighted high-end tourism as a key to increasing foreign investment, which, he said, over five years has the potential to quadruple, adding that the success of Song...

Mortgage loan approvals soar through 2011

Thu, 12 January 2012 Seun Son The use of mortgages for house purchases increased exponentially throughout 2011, as home buyers capitalised on the nascent market, according to industry experts. The relatively infant mortgage loan market, which came into existence in 2008, has played a key role the development of the property and construction sector, said In Siphann, ACLEDA Bank vice president and head of the company’s credit division. “Our observations show the use of home loans services has led to an increase in house transactions,” he said, adding that transactions are still some way off hitting the figures seen during the boom peak of 2007. ACLEDA Bank statistics showed that it provided some 3244 mortgage loans, worth US$75 million in the first 11 months of 2011, a 30 per cent year-on-year growth. “We give mortgage loans for up eight years, providing clients with loans up to $7 million,” In Siphann said. He added that the ACLEDA Bank also offer others services loans which totalled$160 million with it provided some 116,000 customers for the first eleven months of 2011. Still, some industry experts and economists believe interest rates, which are currently capped at 15 per cent, need to be reduced and applications requirements eased. Cheng Kheng, managing director of Cambodia Properties Limited told the Post that while continual growth and involvement from the banking sector boosted investment in the property market through 2011, some amendments are still needed. “The increase in the number of banks provides customers with more choices, especially for home loans, however, the banks still require a lot of documents and offer high interest rates,” he said,...