Is buying a property in Toul Tom Poung a good investment?

Last updated on December 20, 2023

Yes, the analysis of Phnom Penh's property market is included in our pack

If you've admired the local culture and scenic beauty of Toul Tom Poung, you might have considered making this peaceful Phnom Penh neighborhood your serene retreat, relishing its tranquil ambiance and community charm.

Is it a good idea though? What's the current state of the real estate market in that area? Are property values appreciating or depreciating? Are investors seeing returns on their real estate investments? How's the demand for rentals?

We'll answer all these questions for you! When building and updating our property pack for Cambodia, our team has been researching and surveying this area. In fact, there is significant customer interest in investing there. Therefore, we believe it would be beneficial to include some information about it in our property pack.

Why do property buyers like investing in Toul Tom Poung?

Toul Tom Poung, often referred to as the Russian Market area, has become a notable spot in Phnom Penh for property buyers, and understanding its appeal requires a look at its unique attributes compared to other real estate markets in the city.

Firstly, let's delve into what makes Toul Tom Poung stand out. This area, with its vibrant cultural blend, offers a more authentic Cambodian experience mixed with an expat-friendly environment.

It's known for its bustling market, from which it gets its nickname, offering everything from local handicrafts to trendy cafes. This eclectic mix of traditional and modern makes it an attractive spot for those seeking a lively, yet culturally rich living experience.

In contrast to more developed areas like BKK1 or Tonle Bassac, known for their high-end apartments and expat-oriented amenities, Toul Tom Poung provides a more grounded, local atmosphere.

This doesn't mean it lacks in modern comforts; rather, it integrates them into a more traditional urban fabric. The area has seen a surge in popularity over the past decade, especially among young professionals and expatriates.

This rise can be attributed to its more affordable property prices while still offering convenient access to the city center.

It's a fair question. The real estate market is dynamic, but Toul Tom Poung's appeal seems rooted in factors that have long-term value; cultural richness, affordability, and a balance of tradition and modernity. These aspects suggest that its popularity might not just be a passing trend.

The kind of people attracted to Toul Tom Poung are diverse. It's a favorite among young professionals, expatriates, and families who appreciate its blend of local life and expat-friendly amenities.

The area offers a variety of housing options, from traditional Khmer-style homes to modern apartments, catering to different preferences and budgets.

However, like any place, Toul Tom Poung has its drawbacks. The area can be quite bustling and might not suit those looking for a quieter, more residential atmosphere.

Traffic congestion is a common issue, as in many parts of Phnom Penh, and the local infrastructure is still catching up with the area's rapid development. For some, the very factors that make it attractive - its vibrancy and eclectic mix - might be overwhelming.

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Why is Toul Tom Poung a nice place to live?

Living in Toul Tom Poung, offers a unique experience that blends traditional Cambodian culture with the conveniences of modern living.

This area has grown significantly in popularity, especially among expatriates, and there are several reasons why.

The lifestyle and culture in Toul Tom Poung are vibrant and diverse. The area is named after the famous Russian Market, a bustling hub where you can find everything from local handicrafts to trendy cafes and international cuisine.

This market, along with various street food stalls and boutique shops, forms the heart of the area, creating a lively atmosphere that's both traditionally Cambodian and welcoming to foreigners.

The expat community in Toul Tom Poung is thriving. Many foreigners choose to live here due to the area's eclectic vibe and the availability of amenities that cater to Western tastes. This expat presence has led to a variety of international restaurants, bars, and cafes, making it a culturally rich and diverse area to reside in.

Regarding the cost of living, Toul Tom Poung is often considered more affordable compared to other expat-heavy districts in Phnom Penh, like BKK1. Housing ranges from budget-friendly apartments to more upscale options, catering to different financial capabilities.

Safety is a crucial factor for any residential area, and Toul Tom Poung is generally regarded as safe. Like any bustling urban area, it's wise to be cautious, especially at night, but the community is friendly, and there's a sense of shared responsibility among residents.

The area is well-equipped with amenities and facilities. For education, there are several international schools nearby, such as the iCAN British International School. Healthcare needs are serviced by facilities like the Russian Hospital.

For shopping and entertainment, apart from the Russian Market itself, there are numerous smaller malls and supermarkets catering to a variety of needs.

Infrastructure in Toul Tom Poung is continuously improving. The roads, while busy, are generally in good condition. Utilities such as electricity and water supply are reliable, and internet connectivity is strong, which is a significant draw for remote workers and digital nomads.

Accessibility is another plus for Toul Tom Poung. It's conveniently located, making it relatively easy to reach other parts of Phnom Penh. Major transport hubs like the Phnom Penh International Airport are not too far away, making travel in and out of the country hassle-free for residents.

Public transportation options, while not as extensive as in some larger cities, are available. Tuk-tuks and taxis are the most common means of getting around.

Recently, there has been an increase in app-based transportation services, which have added convenience and safety to daily commutes.

How much does it cost to buy real estate in Toul Tom Poung?

If you need a detailed and updated analysis of the prices, rents and yields, you can get our full guide about real estate investment in Cambodia.

When considering buying property in Toul Tom Poung, it's essential to understand the diverse range of options available and the dynamics of the local real estate market.

In Toul Tom Poung, you'll find various types of residential properties. This includes apartments, ranging from modest units to more luxurious serviced apartments, traditional Khmer-style houses, and, although less common, some high-end villas. The area has seen a rise in demand for apartments, especially among expatriates and young professionals.

This is largely due to the neighborhood's vibrant atmosphere, the blend of traditional and modern lifestyles, and the availability of amenities that cater to a more international taste.

The market in Toul Tom Poung is a mix of new developments and resale properties. In recent years, there has been a noticeable increase in the construction of new apartment buildings, reflecting the growing demand for modern living spaces in this culturally rich area.

Speaking of prices, the cost of properties in Toul Tom Poung varies widely. As a general estimate, prices per square meter can range from around $1,000 to $2,500, though this can go higher for luxury properties or those in prime locations.

These figures represent a significant increase over the past few years, driven by the area's growing popularity and ongoing development.

Looking at the future of the real estate market in Toul Tom Poung, there are several factors to consider. The area continues to attract interest due to its unique charm and the balance it offers between a traditional Khmer lifestyle and modern conveniences.

Ongoing and upcoming developments, both in residential and commercial sectors, are likely to continue driving up property values.

For instance, new apartment complexes and potential city planning changes to improve infrastructure could make the area even more desirable.

Predicting the future market trends in Toul Tom Poung, it's reasonable to expect continued growth in property values, especially as the area further develops and attracts more investment.

Factors such as its popularity among expatriates, the blend of cultural and modern amenities, and its location within Phnom Penh make it an attractive option for both residential and investment purposes.

A potential increase in property value in Toul Tom Poung could be indicated by several factors. The ongoing urban development, improving infrastructure, and the steady influx of expatriates and young professionals are key indicators.

Additionally, as Phnom Penh continues to grow and develop, areas like Toul Tom Poung that offer a unique living experience are likely to become increasingly sought after.

Where is the best area to buy a property in Toul Tom Poung?

When looking for the best area to buy property in Toul Tom Poung, it's important to consider the different characteristics each part of the neighborhood offers.

Toul Tom Poung, often referred to as the Russian Market area, is diverse in terms of atmosphere, property types, and prices, making certain areas more suitable for different buyers depending on their preferences and needs.

Toul Tom Poung is known for its vibrant atmosphere, largely centered around the Russian Market itself. This area is bustling with activity, offering a mix of traditional markets, street food, and modern cafes.

Properties here are typically closer to the market and include a range of options from older, more traditional homes to newer apartment buildings. Prices in this central area can be higher due to the convenience and lively environment it offers.

Moving away from the market, the atmosphere becomes more residential and quieter. These areas still provide easy access to the market's amenities but offer a more relaxed living environment.

Properties here are a mix of modern apartments and traditional homes, and prices can be slightly more affordable compared to the market's immediate vicinity.

For buyers interested in up-and-coming areas within Toul Tom Poung, it's worth exploring the outskirts of the neighborhood. These areas are currently seeing more development, with new residential projects and infrastructure improvements.

While they might currently lack some of the vibrancy of the market's heart, they offer the potential for future growth and appreciation in property values.

When considering where to buy, areas closer to the Russian Market are ideal for those who enjoy a lively urban atmosphere and want to be in the heart of the action. The streets around the market are especially popular for their accessibility to shops, restaurants, and cultural activities.

For those seeking a more tranquil setting, the outer areas of Toul Tom Poung offer a quieter residential experience while still being conveniently close to the neighborhood's amenities.

On the contrary, certain parts of Toul Tom Poung might be less advisable for property investment, particularly areas that are overly congested or have limited access to essential services like healthcare and education.

Additionally, areas with less developed infrastructure might not offer the same quality of life or investment potential as the more established parts of the neighborhood.

Here is a summary table to help you visualize better. If you need more detailed data and information, please check our property pack for Cambodia.

Area	Atmosphere	Property Types	Price Range
Central Toul Tom Poung (Near Russian Market)	Vibrant, bustling with activity	Traditional homes, new apartments	Higher
Residential outskirts of Toul Tom Poung	Quieter, more residential	Mix of modern apartments and traditional homes	More affordable
Outer areas of Toul Tom Poung	Developing, potential for growth	New residential projects	Varies, potential for appreciation
Areas with limited services and infrastructure	Less developed, potentially congested	Varies	Lower, but with limited investment potential

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Is there a strong rental demand in Toul Tom Poung?

In Toul Tom Poung, there is indeed a strong demand for rental properties, and understanding the nature of this demand can help in making informed investment decisions.

Firstly, the rental market in Toul Tom Poung tends to lean more towards long-term rentals. This is primarily because the area attracts expatriates, young professionals, and families who are looking to stay in Phnom Penh for extended periods.

These groups generally prefer the stability and community feel of a long-term rental compared to the transient nature of short-term accommodations.

The target demographic in Toul Tom Poung is quite diverse. Expatriates are a significant part of this demographic, drawn to the area for its cultural vibrancy and mix of local and international amenities.

Young professionals, both local and international, are also attracted to Toul Tom Poung for its urban lifestyle and relative affordability compared to other expat-heavy districts in Phnom Penh.

Families, including those with children attending international schools in the vicinity, also form a notable segment of the potential tenant base.

These potential tenants are often looking for modern apartments or serviced apartments with amenities like reliable internet, air conditioning, and modern kitchen and bathroom facilities.

Properties that are well-maintained and located in areas with easy access to amenities like international schools, supermarkets, healthcare facilities, and entertainment options are particularly sought after.

Specifically, areas near the Russian Market itself and the streets radiating from it are highly popular. This central location offers convenience and an immersive cultural experience, making it attractive for those who want to live in a vibrant urban setting.

Regarding amenities that help reduce vacancy, features that cater to the comfort and convenience of expatriates and professionals are key. This includes high-speed internet, modern furnishing, fitness centers, and in some cases, swimming pools.

Safety features like security services and parking facilities also add to the appeal. These amenities not only meet the demands of the target demographic but also enhance the lifestyle experience, making properties more attractive for long-term rentals.

The potential returns on investment for rental properties in Toul Tom Poung can be quite favorable. Estimations vary, but it's not uncommon for well-located and well-maintained properties to yield rental returns of around 5-8% annually. This, of course, depends on factors like property type, location, and the quality of amenities offered.

Properties that are increasingly in demand, and thus potentially offering better yields, are modern apartments and serviced apartments. These properties cater to the growing number of expatriates and young professionals seeking a blend of comfort and convenience in an urban setting.

Additionally, as Toul Tom Poung continues to develop and attract more investment, properties that can offer something unique or superior in terms of location and amenities are likely to see increased demand and potentially higher rental yields.

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Is it easy to buy a property as foreigner in Toul Tom Poung?

Before we answer the question, please know that we have an article dedicated to the experience of buying real estate as a foreigner in Cambodia.

Buying property in Toul Tom Poung, Phnom Penh as a foreigner comes with specific considerations, regulations, and processes.

Firstly, there are indeed regulations and restrictions for foreign buyers in Cambodia, which extend to Toul Tom Poung. Foreigners are not allowed to own land outright.

However, they can legally own properties in buildings from the first floor and above, provided that the building has a strata title and the total foreign ownership in the building does not exceed 70%. This essentially means that foreigners can purchase apartments or condominiums but not ground-floor properties or land.

The purchasing process in Toul Tom Poung typically starts with identifying a suitable property. Once a property is selected, a deposit is usually paid to secure it. This is followed by a due diligence process, where the property's legal status and the developer's credibility are verified.

After this, a sales agreement is drafted and signed, and the remaining payment is made according to the agreed terms. Finally, the property title is transferred to the buyer.

There are several risks associated with property investment in Toul Tom Poung, as with any real estate market. One primary risk is the potential for overvaluation of properties, especially in areas that are rapidly developing.

There's also the risk of legal complications arising from unclear land titles or disputes. Additionally, market fluctuations can affect property values and rental yields.

When buying property in Toul Tom Poung, or anywhere in Cambodia, a common pitfall is not conducting thorough due diligence. This includes verifying the legal status of the property, ensuring that the developer has a good track record, and checking for any outstanding disputes or claims on the property.

Unique to Cambodia, there are complexities around land titles, with different types of titles offering varying degrees of security and ownership rights.

Working with a local real estate agent or lawyer is highly advisable. They can provide valuable insights into the local market, assist with navigating the legal intricacies, and help avoid common pitfalls.

A local expert's knowledge is particularly important for understanding the nuances of Cambodian property law and ensuring that all legal requirements are met.

Common exit strategies for property investors in Toul Tom Poung include selling the property after a period of appreciation or renting it out to generate ongoing rental income.

The choice of strategy often depends on the market conditions and personal investment goals. Some investors might also consider leasehold arrangements or enter into joint ventures with local partners as part of their exit strategy.