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Yes, the analysis of Phnom Penh's property market is included in our pack
Phnom Penh's property market in 2025 presents a compelling investment opportunity with stable prices, strong rental yields, and moderate growth projections.
(The Cambodian capital shows condo prices averaging $2,000-$3,000 per sqm in central districts, rental yields of 6-8%, and annual price growth forecasts of 5-10% through 2026, supported by major infrastructure developments including the new Techo International Airport.)If you want to go deeper, you can check our pack of documents related to the real estate market in Cambodia, based on reliable facts and data, not opinions or rumors.
Phnom Penh's property market shows stable recovery with condo prices down 10-20% from 2020 peaks but rebounding strongly. Foreign buyers dominate the condo segment while locals prefer landed properties, creating distinct market dynamics across property types.
| Property Type | Average Price per sqm | Rental Yield | 5-Year Price Change |
|---|---|---|---|
| Central Condos | $2,000-$3,000 | 6-8% | -10% to -20% |
| Citywide Condos | $1,600-$2,200 | 6-8% | -10% to -20% |
| Landed Houses (Borey) | $1,000-$2,000 | 6-7.5% | Stable to +5% |
| High-End Houses | $2,500-$4,000 | 7-9% | +5% to +10% |
What's the current average price per square meter for condos and landed houses in Phnom Penh, and how does it compare to five years ago?
Phnom Penh's condo market currently shows central district prices averaging $2,000-$3,000 per square meter as of September 2025.
Citywide, entry to mid-range condominiums typically cost $1,600-$2,200 per square meter. These prices represent a significant correction from the market peak experienced in 2020, when average condo prices reached approximately $3,000 per square meter across the city.
Landed houses in suburban Borey developments average $1,000-$2,000 per square meter, while high-end homes in prime locations command $2,500-$4,000 per square meter. The landed property segment has shown more stability compared to condominiums over the five-year period.
Compared to five years ago, average condo prices are down 10-20% from their pre-pandemic peak. However, the market has been rebounding since 2024, with sustained annual growth of 5-10% now established as the new trend.
This price correction has created attractive entry points for investors, particularly in the condo segment where foreign ownership is permitted.
How fast are property prices expected to rise or fall over the next 12 to 24 months, and what's the annual percentage growth forecast?
Phnom Penh property prices are forecasted to increase by 5-10% annually through 2026, with sustained demand in both affordable and mid-range segments.
The growth trajectory is supported by several key factors including the completion of Techo International Airport in 2025, new bridge constructions, and ongoing urban infrastructure upgrades. These developments are expected to boost demand particularly in southern and northeastern districts of the city.
Market analysts expect the strongest growth in the $1,500-$2,500 per square meter price range, which represents the sweet spot for both local upgraders and foreign investors. Premium properties above $3,000 per square meter may see more moderate appreciation of 3-7% annually.
The recovery pattern suggests that properties purchased at current price levels will benefit from both the catch-up growth from the recent correction and the underlying demand driven by infrastructure improvements.
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What is the average rental yield right now in central districts versus suburban areas, and how has that shifted recently?
Central Phnom Penh delivers impressive rental yields averaging 6-8% gross, with the highest returns concentrated in Chroy Changvar district at 7-9% and Tonle Bassac at 6-8%.
Suburban areas offer competitive yields ranging from 6-7.5%, though some premium developments achieve up to 10% through guaranteed rental programs. The suburban yield advantage comes from lower purchase prices while maintaining reasonable rental rates.
Rental yields have remained remarkably stable year-on-year, with minor increases accompanying the lower purchase prices experienced post-pandemic. This stability reflects consistent rental demand even during market corrections.
The yield differential between central and suburban areas has narrowed over the past year, as central property prices have corrected more significantly than suburban prices, while rental rates have held steady across both areas.
Investors should note that guaranteed rental programs, while attractive, often come with higher management fees and should be evaluated carefully for net returns.
How many new residential and commercial units are scheduled to be completed in the next three years, and what percentage increase in supply does that represent?
The residential supply pipeline shows approximately 10,259 serviced apartments projected for completion by 2028, representing a 22% growth in this segment.
Commercial development is even more robust, with 541,700 square meters of new office space expected between 2025-2028. Notably, 88% of this new commercial space will be Grade A quality, primarily concentrated in Daun Penh and Sen Sok districts.
This supply increase represents a significant expansion of Phnom Penh's modern real estate stock, but remains manageable given the city's growing population and economic development. The focus on higher-grade developments suggests developers are targeting the premium end of the market.
The geographical concentration of new supply in established business districts indicates confidence in these areas' continued growth and demand sustainability.
Supply timing is well-coordinated with major infrastructure completions, suggesting developers are positioning for the demand boost expected from improved connectivity and accessibility.
What is the current vacancy rate for condos, apartments, and office space, and how is it trending compared to last year?
Condominium vacancy rates have stabilized around 8-15% as of September 2025, showing marked improvement from higher levels in previous years.
| Property Type | Current Vacancy Rate | Trend vs. 2024 | Market Condition |
|---|---|---|---|
| Condominiums | 8-15% | Improved | Stabilizing |
| Serviced Apartments | 10-18% | Stable | Competitive |
| Grade A Offices | 12-20% | Declining | Improving |
| Grade B Offices | 15-25% | Stable | Challenging |
| Retail Space | 18-30% | Declining | Recovering |
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What percentage of property buyers are foreign investors versus local buyers, and how is that balance changing?
Foreign buyers dominate the condominium segment, constituting up to 70% ownership in some premium projects throughout Phnom Penh.
Local buyers remain the majority for landed homes and Borey developments, as foreign direct purchase of land is generally prohibited except through complex leasehold structures that most foreign investors avoid.
The foreign share in the condo market is gradually rising as the market recovers and investor interest diversifies beyond traditional Chinese buyers to include investors from other Asian countries, Australia, and Western markets.
This buyer composition creates distinct market dynamics, with condo pricing and features often designed to meet international standards, while landed property developments focus on local preferences and affordability.
The trend suggests continued strong foreign participation in the condo sector, particularly as Cambodia's economic growth and infrastructure development attract more international attention.
What are the average mortgage interest rates available in Phnom Penh today, and how do they affect affordability compared to regional markets?
Average USD mortgage rates in Phnom Penh currently range from 7-9% fixed, depending on the bank and loan term as of September 2025.
These rates are notably higher than neighboring markets, with Thailand offering 5-7% and Malaysia providing 3-4% for similar loan products. This rate differential significantly impacts affordability calculations for potential buyers.
The higher interest rates reflect Cambodia's developing financial sector and currency risks, as most property transactions and mortgages are denominated in US dollars rather than the local riel.
For a mid-range condo priced around $180,000, buyers typically need annual household income of $18,000-20,000 for a 10-year financing horizon, making homeownership accessible primarily to middle and upper-middle-class households.
The rate environment favors cash purchases, explaining why many foreign investors and wealthy locals prefer to buy outright rather than finance their property acquisitions.
How much household income, on average, is required to buy a mid-range condo, and how many years of income does that typically represent?
Purchasing a mid-range condo in Phnom Penh requires annual household income of approximately $18,000-20,000 based on current mortgage qualification standards.
This income requirement translates to 9-11 years of average household income to purchase a typical mid-range condominium, which is higher than regional benchmarks but reflects both property prices and local income levels.
The calculation assumes a $180,000 purchase price for a decent two-bedroom condo in a good location, with standard mortgage terms including a 20% down payment and 10-year loan term.
Affordability varies significantly by district, with condos in emerging areas requiring 6-8 years of income, while prime central locations may require 12-15 years of average income.
It's something we develop in our Cambodia property pack.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Cambodia versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.
What infrastructure or urban development projects are planned or underway that could directly impact property demand in the next five years?
The completion of Techo International Airport in 2025 represents the most significant infrastructure development impacting Phnom Penh's property market.
- Techo International Airport - Full operations began in 2025, dramatically improving international connectivity and positioning southern districts for growth
- New Bridge Construction - Multiple bridge projects connecting different parts of the city, reducing traffic congestion and opening new residential areas
- Highway Expansion - Major arterial roads being widened and improved to handle increased traffic from population growth
- Urban Renewal Projects - Systematic upgrading of older districts with improved utilities, drainage, and public spaces
- Transit System Development - Early-stage planning for mass transit options, though implementation timelines remain unclear
These infrastructure improvements are expected to enhance accessibility and attractiveness for both residential and commercial investment, particularly benefiting properties near major transport nodes.
What's the expected return on investment (ROI) for buying a condo at current prices and renting it out over a 10-year horizon?
Ten-year condominium ROI in Phnom Penh typically generates gross returns of 6-8% annually, potentially totaling 80-100% gross appreciation plus rental income over the full period.
This projection assumes current price trends persist, with 5-7% annual capital appreciation combined with 6-8% rental yields throughout the holding period. Properties in prime locations may achieve higher returns, while secondary locations may see more modest performance.
Guaranteed rental programs offered by select luxury projects may provide higher returns but come with increased risk and management fees that reduce net returns. Investors should carefully evaluate the sustainability of guaranteed returns.
The ROI calculation benefits from the current market timing, as properties purchased at post-correction prices should capture both recovery growth and underlying market expansion driven by infrastructure development.
Successful investment outcomes depend heavily on property selection, with buildings offering good management, strategic locations, and quality construction commanding premium rents and appreciation.
How does Phnom Penh's property price-to-income ratio compare with neighboring cities like Bangkok, Ho Chi Minh City, and Kuala Lumpur?
Phnom Penh's price-to-income ratio of 25-27 positions it competitively within the regional market, though individual market dynamics vary significantly.
| City | Price-to-Income Ratio | Average Condo $/sqm | Rental Yield (%) |
|---|---|---|---|
| Phnom Penh | 25-27 | $2,000-$3,000 | 6.8 |
| Bangkok | 26-27 | $4,500 | 3.4 |
| Ho Chi Minh City | 30-31 | $3,200 | 4.6 |
| Kuala Lumpur | 18-20 | $2,800 | 4.3 |
| Jakarta | 22-24 | $2,100 | 5.2 |
What are the government's current policies or regulations on property ownership, foreign investment, and taxes, and how might they shape the market outlook?
Cambodia maintains liberal foreign ownership rules for condominiums, allowing foreigners to own units above the ground floor up to 70% of total units per building.
Foreigners cannot own land directly, making landed property accessible only through lease arrangements or nominee structures that are not recommended for most foreign investors due to legal complexity and risks.
Property transfer tax currently stands at 4% of transaction value, which is moderate compared to regional markets. Additional costs include legal fees, registration fees, and due diligence expenses.
The government actively encourages foreign investment in real estate, focusing on continued improvement of market transparency and legal framework stability. Recent reforms have enhanced property registration processes and dispute resolution mechanisms.
It's something we develop in our Cambodia property pack.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Phnom Penh's property market presents a compelling opportunity for investors seeking higher yields and moderate capital appreciation in a developing Southeast Asian market. The combination of infrastructure development, stable government policies, and attractive pricing creates favorable conditions for both investment and lifestyle purchases.
Success in this market requires careful property selection, understanding of local regulations, and realistic expectations about market timing and returns. The city's continued economic growth and urban development suggest positive long-term prospects for well-chosen real estate investments.
Sources
- IPS Cambodia - Phnom Penh Condo Market Trends 2025
- BambooRoutes - Condo Prices Phnom Penh
- Dabest Properties - Cambodia Condo Trends
- BambooRoutes - Phnom Penh Price Forecasts
- BambooRoutes - Average House Price in Cambodia
- Beach and Houses - Phnom Penh Real Estate ROI 2025
- Global Property Guide - Cambodia Rental Yields
- Numbeo - Property Investment Rankings 2025
- Cambodia Market Entry - Future of Real Estate
- Knight Frank - Cambodia Real Estate Highlights H2 2024