Authored by the expert who managed and guided the team behind the Cambodia Property Pack
Yes, the analysis of Phnom Penh's property market is included in our pack
Are you considering investing in a rapidly growing real estate market? Curious about the potential returns and lifestyle benefits of owning property in Phnom Penh? Wondering why 2025 is the perfect year to make your move?
We will lay down recent insights, ici no guesswork, we rely only on solid data.
Actually, we know this market inside and out. We keep tabs on it regularly, and all our discoveries are reflected in the most recent version of the Cambodia Property Pack
1) Foreign investors boost Phnom Penh property prices with growing interest
Foreign investors are showing growing interest in Phnom Penh, which is pushing property prices up.
High-end properties are in demand, with condominium prices at $2,718 per square meter in early 2024. This trend is likely to continue, with prices expected to rise by 5% to 10% in 2025 due to economic growth and urban development.
Foreign direct investment (FDI) in Cambodia's real estate is booming. In 2021, FDI jumped by 53%, reaching $3.4 billion, the highest since 2013. This surge is mainly driven by investments from China and other Asian countries, fueling demand for both commercial and residential properties.
Real estate agencies are noticing a new wave of first-time investors from places like Japan, the UK, Australia, Italy, and Hong Kong. These investors are particularly interested in residential condominiums with strata titles.
Interestingly, Chinese investors, who were once focused solely on investment, are now buying properties for personal use. This marks a shift in investment behavior, indicating a more personal stake in the market.
Sources: CBRE Highlights Phnom Penh's Property Market Adjustments Amid Changing Consumer Demands in 2024, Foreign Direct Investment in Cambodia's Real Estate Market, Unfolding Cambodia's Changing Property Investor Profile
2) Phnom Penh's growing retail boosts neighborhood appeal and property values
The city's retail boom is boosting neighborhood appeal and property values.
By 2025, the retail space is set to surpass 800,000 square meters, thanks to 51 completed projects and 72 more underway, adding a whopping 890,000 square meters. This surge is reshaping the cityscape, making it a hotspot for potential property buyers.
High-end brands like Jimmy Choo, Moschino, Versace, and Christian Dior are making their mark, bringing in tens of millions in foreign investment. Their presence is turning the city into a luxury shopping hub, drawing affluent shoppers and boosting the allure of nearby neighborhoods.
Community malls are a hit, accounting for over 50% of Phnom Penh’s retail properties. Areas like Sen Sok, Meanchey, Chamkarmon, Toul Kork, and Chbar Ampov are seeing property values rise as these retail spaces develop, reflecting a strong consumer demand for variety.
Neighborhoods with these retail options are becoming more desirable, attracting both locals and expats looking for convenience and lifestyle. The influx of luxury brands and diverse retail offerings is transforming the city into a vibrant shopping destination.
For those considering a property investment, the expanding retail sector is a key factor to watch. It's not just about shopping; it's about the enhanced lifestyle and increased property value that come with it.
Sources: Cambodia Investment Review, Khmer Times, Abode Real Estate
Everything you need to know is included in our Real Estate Pack for Phnom Penh
3) Phnom Penh is booming with new residential projects offering modern amenities
Phnom Penh is buzzing with new construction projects, transforming the cityscape with modern residential options.
In early 2024, the government approved projects valued at KHR9.2 trillion ($2.2 billion), marking a 649% increase from the previous year. This surge in construction permits is a key driver of the boom. The city is becoming a hotspot for international developers, with projects like Le Conde BKK1 and Diamond Bay Gardens leading the way.
Foreign direct investment is pouring into Phnom Penh's real estate market, largely due to the growing expatriate community seeking modern living spaces. These new developments are packed with amenities that cater to international tastes, making them highly attractive to foreign buyers.
Infrastructure projects are also enhancing the city's appeal. The Phnom Penh-Siem Reap-Poipet Expressway and the Funan Techo Canal are examples of initiatives that boost urban connectivity, making the city more accessible and livable. This improved infrastructure is a magnet for further construction activity.
The demand for modern housing is on the rise, driven by the expatriate community's desire for homes with integrated wellness facilities and entertainment options. These features are becoming standard in new residential projects, setting a high bar for future developments.
With major international developers entering the market, Phnom Penh is rapidly evolving. The city is not just expanding; it's transforming into a hub of modern living, offering a lifestyle that appeals to both locals and foreigners alike.
Sources: GlobeNewswire, Realestate.com.kh, IPS Cambodia
4) Cambodia's booming economy drives rapid real estate growth in Phnom Penh
The Cambodian economy is booming, making it a hot spot for real estate investment, especially in Phnom Penh.
With GDP growth expected to hit 6.40% in 2024 and potentially rising to 7.00% in 2025, the economic climate is ripe for property development. This steady growth is creating a welcoming environment for new real estate projects.
Phnom Penh is becoming more accessible thanks to major infrastructure upgrades. New bridges, a fresh airport in Siem Reap, and improved ports and ring roads are making the city more appealing to businesses and residents alike, which in turn is boosting the real estate market.
The city is also experiencing a population boom. With projections indicating that Phnom Penh's population could double by 2030, there's a growing demand for both residential and commercial properties. This surge in urbanization is a key driver of real estate growth.
Government policies are playing their part too. By focusing on macroeconomic stability and sustainable growth, these policies are encouraging investment in infrastructure and other sectors, laying down a solid foundation for the real estate market to thrive.
Sources: Phnom Penh Post, B2B Cambodia, Trading Economics, UNFPA Cambodia
5) Phnom Penh's prime Southeast Asia location makes it a key hub for trade and business
Phnom Penh is a key hub for regional trade and business in Southeast Asia.
The city's ports are bustling, with the Phnom Penh Autonomous Port handling over 4 million tons of cargo in 2023. This is just the beginning, as plans are underway to double its container-handling capacity by 2029, making it even more crucial for regional logistics.
Infrastructure is getting a major boost with projects like the upcoming Techo International Airport. This development will improve connectivity and facilitate easier access for international businesses, aligning with Cambodia's strategic initiatives to tackle logistical challenges and ramp up trade.
Phnom Penh's role in regional economic cooperation frameworks, such as ASEAN, highlights its strategic importance in international trade. The city is becoming a magnet for multinational companies, which are increasingly setting up offices here, drawn by its growing business appeal.
With these developments, Phnom Penh is not just a city on the rise; it's a place where business opportunities are expanding rapidly. The Cambodian government is keen on enhancing this growth, ensuring the city remains a pivotal player in the region.
Sources: Nation Thailand, Cambodia Investment Review, Focus Cambodia
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6) Phnom Penh's riverfront developments are now prime real estate locations
Phnom Penh's riverfront is now a hot spot for real estate.
Over the past decade, property prices in these areas have skyrocketed. Back in 2013, you could snag a spot for $800 to $1,100 per square meter. Fast forward to 2023, and those prices have jumped to between $1,700 and $3,000 per square meter. This means investors are seeing strong capital appreciation, making riverfront properties a smart buy.
Foreign investors are also eyeing these developments, especially luxury condos. For example, high-end condo sales prices held steady at $2,718 per square meter in 2024, showing consistent demand from international buyers. Developments like Vue Aston are particularly popular, drawing in foreign interest and boosting the area's allure.
The government is also pitching in with projects like the Funan Techo Canal, which aims to improve connectivity by linking Phnom Penh to the deep-sea port in Sihanoukville. This kind of infrastructure development is expected to enhance the riverfront's investment potential.
High-profile projects such as The Skyline Residences and The Peak Residences are setting new standards for luxury living. These places offer upscale amenities like rooftop infinity pools and private cinemas, making them attractive to both residents and investors. Luxury living is becoming the norm here.
There's a growing demand for luxury apartments, with rental yields in the Riverside district ranging from 6-12%. This demand is fueled by the area's vibrant cultural scene and proximity to iconic spots like the Royal Palace. People want to live where the action is.
Residents and businesses are raving about the quality of life in these developments. Luxury condos like The Skyline Residences get high marks for their amenities and overall living experience. It's not just about the property; it's about the lifestyle.
Sources: Retalk Asia, Fulcrum, Dabest Properties, Cambodia Investment Review
7) Phnom Penh's new business districts are driving demand for nearby residential properties
Phnom Penh is buzzing with new business districts, sparking a surge in demand for nearby homes.
Take Camko City, for example. It's a massive $2 billion project that's not just about office space for global giants but also includes homes, leisure spots, an international school, and even a hospital. This makes it a one-stop hub for living and working.
With big names like Coca Cola and Tiffany & Co. setting up shop in Phnom Penh, there's a noticeable uptick in people wanting to live close to these business areas. Developments like Odom, which mix commercial, office, and residential spaces, are becoming hot spots. Living near work is becoming the new norm.
The city's population is on the rise, especially in urban zones, which means more homes are needed near these bustling business districts. Urban growth is driving real estate demand in these areas.
Public transport is getting a boost too, making it easier to commute from home to work. This improvement is making residential areas near business hubs even more attractive. Better transport links are a game-changer for city living.
Sources: SCMP, Wikipedia, Biz ASEAN, Real Estate Cambodia
8) Phnom Penh offers Asia's top rental yields with excellent returns for investors
Phnom Penh boasts some of the highest rental yields in Asia, making it a hot spot for property investors.
In 2023 and 2024, the city offered rental yields of 5.3% for condominiums, which is quite impressive compared to many other Asian cities. This is largely due to the strong demand for rental properties, fueled by a growing expatriate community and increasing foreign investment. The city's low cost of living and vibrant cultural scene make it a magnet for expatriates, further boosting the rental market.
Phnom Penh's property prices and rental income are more favorable compared to regional counterparts like Ho Chi Minh City and Kuala Lumpur. The city offers competitive construction costs and higher rental yields for high-end condos, around 6%, making it an appealing market for investors.
For those looking to invest, Phnom Penh's real estate market is supported by a dynamic economic environment and a government that encourages foreign investment. The city is rapidly developing, with new infrastructure projects and modern amenities that attract both locals and foreigners.
Investors are particularly drawn to the high-end condo market, where yields can reach up to 6%. This segment is thriving due to the influx of expatriates and the city's growing reputation as a business hub in Southeast Asia.
With its strategic location and ongoing urban development, Phnom Penh is poised to remain a lucrative option for property investors seeking high returns and growth potential.
Sources: Odom Phnom Penh, IPS Cambodia, Cambodia Investment Review
Everything you need to know is included in our Property Pack for Phnom Penh
9) Phnom Penh's real estate market is transparent and easy for investors to navigate
Phnom Penh's real estate market is now easier for investors to navigate thanks to increased transparency.
One big change is the move towards digital land records. The Ministry of Land Management, Urban Planning and Construction is working on digitizing all Cambodian land titles. This means a more streamlined and transparent process for registering land, which is a huge step forward for anyone looking to invest in property here.
Another helpful resource is the comprehensive market reports from agencies like CBRE Cambodia. These reports break down economic indicators and market trends, giving investors a clear picture of what's happening in Phnom Penh. With international firms like CBRE providing these insights, you get a global perspective that’s backed by data.
The government is also playing its part by introducing regulations to make property transactions more transparent. For instance, Sub-Decree No. 50 is designed to boost investor confidence by enhancing real estate management. Plus, Cambodia's removal from the FATF grey list shows that the country is serious about implementing policies to protect foreign investments.
These changes are not just on paper. The Royal Government of Cambodia is actively working to improve the real estate sector's transparency. This includes strategic Anti-Money Laundering and Combating the Financing of Terrorism policies, which provide legal protection for foreign investments.
With these developments, Phnom Penh is becoming a more attractive destination for property investors. The combination of digital advancements, detailed market reports, and government initiatives is creating a more transparent and investor-friendly environment.
Sources: Knight Frank, The Better Cambodia, Cambodia Investment Review, Cambodia Investment Review, Khmer Times
10) Phnom Penh's booming tech industry is driving demand for housing from young professionals
Phnom Penh's tech scene is booming, especially between 2022 and 2024.
In 2023, Cambodia saw 177 startups in action, with a whopping 129 in the tech sector. This surge highlights a significant rise in areas like fintech and e-commerce. The city is buzzing with innovation, and it's not just by chance.
Government initiatives are a big part of this story. Programs like 'Cambodia Tech Catalyst 2024' are designed to foster thousands of tech startups and digital jobs. Plus, there's a push to improve internet infrastructure, which is a lifeline for tech businesses.
As the tech industry grows, young professionals are flocking to Phnom Penh for job opportunities. This influx is creating a buzz in the housing market, especially in neighborhoods near tech hubs and coworking spaces.
Real estate reports show that property values are climbing in these areas, signaling a need for more housing solutions. It's a dynamic time for the city, with tech workers driving demand for homes.
Sources: Nucamp, CDRI, Cambodia Investment Review, Nucamp
11) Phnom Penh's low property tax rate attracts investors
Phnom Penh offers an attractive opportunity for investors due to its notably low property tax rate.
In Cambodia, the tax on immovable property is just 0.1% per year, calculated on 80% of the property's market value. This low rate is a big draw for investors aiming to maximize their returns. Compared to other regional capitals, Phnom Penh's property tax rate is remarkably lower, making it a standout choice.
While specific rates for cities like Ho Chi Minh City aren't detailed here, it's generally understood that Phnom Penh's rate is more favorable. This comparative advantage attracts investors who are keen on lower tax burdens. Government reports, such as those from the Asian Development Bank, emphasize that Cambodia's property tax is not only low but also limited in scope.
This means the revenue generated from these taxes is relatively small, which can be appealing to investors concerned about high tax liabilities. The low tax rate is a significant factor for those looking to invest in Phnom Penh's real estate market. The city's tax structure is designed to be investor-friendly, encouraging more foreign and local investments.
Sources: Asian Development Bank, Cambodia Investment Review, PwC Tax Summaries
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12) Phnom Penh's mixed-use developments are booming offering diverse investment opportunities
Phnom Penh is buzzing with new mixed-use developments that are catching the eye of investors.
These projects, like the Global Tech Exchange, are part of the Phnom Penh City Center initiative, aiming to turn the city into a modern and eco-friendly hub with a blend of living, shopping, and working spaces. The city is becoming a hotspot for Foreign Direct Investment (FDI), especially in real estate, thanks to policies allowing freehold foreign property ownership and full business ownership.
Phnom Penh's investment climate is further enhanced by the Phnom Penh Green City Strategic Plan, which supports green growth actions and likely offers incentives for eco-friendly developments. The demand for residential and commercial spaces is on the rise, pushing the growth of these mixed-use projects.
The condominium market is holding strong with solid sales prices, and retail space is expected to expand significantly. This shows a healthy appetite for the kind of spaces that mixed-use developments provide, making them a smart choice for investors.
With the city's strategic plans and favorable investment conditions, mixed-use developments are not just a trend but a promising opportunity for those looking to invest in Phnom Penh's future. The city is transforming, offering a dynamic environment where living, working, and leisure blend seamlessly.
Sources: Building a Smart City: Mixed-use Development in Phnom Penh, CBRE Highlights Phnom Penh's Property Market Adjustments Amid Changing Consumer Demands in 2024, Phnom Penh Green City Strategic Plan 2016 - 2025
13) The Cambodian government's major infrastructure investments are driving up Phnom Penh property values
The Cambodian government is heavily investing in infrastructure, boosting property values in Phnom Penh.
From 2013 to 2022, they poured about $16 billion into infrastructure, a massive sum that has reshaped the city. Even with a slight dip in 2022, the focus on major projects like expressways remains strong. The Phnom Penh-Sihanoukville Expressway, completed in late 2022, is a game-changer, enhancing connectivity and making areas more attractive for living and investment.
Another significant development is the Chroy Changvar Bridge, which links the city center with suburban areas. This connection has led to higher land prices in the Chroy Changvar district, as more people find it appealing to live and invest there. The expansion of Monivong Boulevard is also noteworthy, as it has pushed up property values along its route.
In Toul Kork, land prices have been steadily climbing, ranging from $1,800 to $6,000 per square meter. This increase is a direct result of the area's growing appeal for investment, thanks to improved infrastructure. These developments are not just about roads and bridges; they are about making Phnom Penh a more connected and accessible city.
Such improvements naturally lead to a boost in property values, as the city becomes more livable and attractive for investors. The government's focus on infrastructure is a strategic move to enhance the city's appeal, making it a prime location for property investment.
Sources: Trade.gov, IPS Cambodia, Realestate.com.kh
14) Phnom Penh's rising middle class is driving high demand for modern housing options
Phnom Penh's middle class is on the rise, and they're looking for modern housing options.
With the Cambodian economy bouncing back in 2024, boasting a 6.0% growth rate, more people have extra cash to spend on better homes. This economic boost is making modern housing more accessible to the middle class.
As more folks move to the city, they're embracing urban lifestyles, which naturally leads to a higher demand for modern housing. The real estate market is responding with more affordable and mid-range condos, perfect for the middle class.
Suburban areas like Toul Kork are becoming hotspots, thanks to new infrastructure and amenities. With shopping malls and international schools popping up, these areas offer a well-rounded lifestyle that appeals to modern families.
Foreign investors from China, Japan, South Korea, and Singapore are also eyeing Phnom Penh's real estate, further fueling the demand for contemporary housing. Their investments are reshaping the market landscape.
All these factors combined are making Phnom Penh a vibrant place for the middle class to find their dream homes, with a growing array of modern options to choose from.
Sources: Phnom Penh Post, United Nations Cambodia, Channel News Asia, Cambodia Investment Review
Everything you need to know is included in our Pack for Phnom Penh
15) The local government actively supports foreign real estate investment ensuring a stable environment
The local government in Phnom Penh is very supportive of foreign investment in real estate, creating a stable environment for investors.
One big draw for foreign investors is the foreign ownership laws that let you own 100% of a condo above the ground floor. This policy is a game-changer, making it much easier for foreigners to dive into the real estate market without worrying about ownership restrictions.
On top of that, the government is really pushing to improve infrastructure, which is a big deal for real estate development. Major projects like the Phnom Penh - Sihanoukville Expressway and the Phnom Penh - Ho Chi Minh City High-Speed Rail are in the works, thanks to Chinese companies. These projects, along with the new international terminal at Phnom Penh International Airport, are set to make the city even more appealing to investors by boosting transportation and accessibility.
Another reason to consider investing here is Cambodia's favorable tax policies. There's no capital gains tax, which is a huge plus for foreign investors. Plus, the Special Economic Zones (SEZs) offer various incentives and a stable business environment, making it even more attractive.
These SEZs are designed to lure in foreign businesses and create a welcoming atmosphere for investment. They provide a range of benefits that make setting up shop in Cambodia a smart move.
Sources: B2B Cambodia, Atlas Invest Group, Cambodia Investment Review
16) Phnom Penh's booming tourism drives lucrative short-term rental investment opportunities
Phnom Penh is buzzing with over 3.5 million international visitors in 2023, a huge leap from the previous year.
This surge in tourists has led to higher occupancy rates in hotels and guesthouses, showing just how vibrant the tourism scene is. More travelers are looking for unique stays, which means short-term rentals are in high demand. They want to dive into local culture, sparking interest in ecotourism and cultural hotspots.
The government is all in, pushing initiatives to draw more tourists and investors. A big part of this is the expansion of Phnom Penh International Airport, making it easier for flights to connect from major cities. This makes the city more accessible and attractive to visitors.
New attractions and cultural sites are popping up, giving tourists more to explore and enjoy. This development is a big boost for the tourism sector, offering fresh experiences for every kind of traveler.
With these changes, Phnom Penh is becoming a top choice for short-term rental investments. The city's growth in tourism is a golden opportunity for those looking to invest in the property market.
Sources: Cambodia sees steady growth in international arrivals in August 2024, Phnom Penh airport - VINCI Concessions, Arrivals of foreign tourists soar in 2023: Cambodian ministry
17) Phnom Penh's growing international schools attract expatriate families driving demand for housing
Phnom Penh is seeing a surge in international schools, attracting more expatriate families.
Over the past few years, the city has welcomed more than 50 international schools, with new ones still opening to meet the growing demand. This boom in educational options is a magnet for families from abroad, who are keen on quality education for their children. The International School of Phnom Penh, for example, hosts over 875 students from more than 50 nationalities, highlighting the city's diverse expatriate community.
As more families enroll their children, the median price for international schools has climbed, rising from USD $4,908 in 2022 to USD $5,120 in 2023. This uptick in fees reflects the increasing demand for these schools, as parents are willing to invest in their children's education. The presence of such a vibrant international school scene is a key factor for expatriates choosing to settle in Phnom Penh.
The real estate market in Phnom Penh is also thriving, largely due to the demand for family-sized homes. Expatriate families often prioritize living near quality schools, which has led to a boom in housing demand around these educational institutions. Real estate agents report that these families are actively seeking properties close to international schools, further driving the housing market.
For those considering a move to Phnom Penh, the city's expanding educational landscape and bustling real estate market offer promising opportunities. The rise in international schools not only enhances the city's appeal but also supports a growing community of expatriates. Families looking for a vibrant, multicultural environment will find Phnom Penh an attractive option.
Sources: B2B Cambodia, GSIN Education, International Schools Database
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18) Phnom Penh's cultural and historical sites attract more expatriates and tourists driving up property demand
Phnom Penh's cultural and historical attractions are drawing more expatriates and tourists, boosting property demand.
In 2023, the city welcomed over 3.5 million international visitors, a staggering 250.8% increase from the previous year. This surge highlights Phnom Penh's growing allure as a travel hotspot. The expansion of international airports like Techo-Ta Khmao and Siem Reap Angkor has made it easier for tourists to flock to the city, further fueling the demand for hospitality services and properties.
The Cambodian government is actively promoting cultural tourism, which is attracting more foreign visitors and expatriates. This effort is complemented by the city's vibrant cultural scene, enriched by numerous festivals and events. These activities not only draw tourists but also enhance the local community's cultural landscape, making Phnom Penh a dynamic and culturally rich environment.
Restoration of historical sites adds to the city's charm, making it an attractive destination for expatriates seeking a lively cultural experience. The growing number of expatriate communities and social groups in Phnom Penh is a testament to this trend. These communities are thriving, offering a sense of belonging and connection for newcomers.
Phnom Penh's appeal is not just about its cultural offerings; it's also about the lifestyle it promises. The city offers a unique blend of tradition and modernity, providing expatriates with a rich tapestry of experiences. This blend is a significant factor in the rising property demand, as more people look to make Phnom Penh their home.
Sources: Asia News Network, Odom Phnom Penh, Phnom Penh Post
This article gives you valuable insights, but remember, it’s not and will never be investment advice. We pull data from a range of sources to provide you with the most accurate picture possible, yet we can’t guarantee complete accuracy. Markets are difficult to predict. Make sure to do your own research and consult a professional before making any financial moves. Any risks or losses are your own responsibility.