Chinese rush to buy Cambodian property

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Chinese Rush To Buy Cambodian Property
Phnom Penh building construction © Arno Maierbrugger

Chinese interest in real estate in Cambodia is booming as Chinese investors seek to tap the growing demand for housing and also look for overseas assets as a hedge against yuan devaluation, market experts say.

A thriving job market as a result of the booming economy has boosted demand for housing in the larger urban areas in Cambodia. This has pushed current rental yields to between eight and ten per cent and asset appreciation to 15 per cent per year, making the Southeast Asian nation’s property sector an attractive property bet.

The country’s GDP grew 7.5 per cent and exports surged 17.6 per cent last year, mainly owing to massive inflow of Chinese investment in infrastructure projects on the back of the Belt and Road Initiative, and factories relocating from the mainland to take advantage of the cheap labour and dodge punitive tariffs imposed by Washington in the ongoing US-China trade war.

“Chinese buying in Cambodia has gone from minimal to substantial over the past three years,” says Carrie Law, CEO of Hong Kong-based property portal Juwai.com, a platform for Chinese buyers of international propertie.

“Year-on-year growth in Chinese buying has been climbing by more than 90 per cent per quarter since mid-2017. The fourth quarter of 2018 and the first quarter of 2019 saw the highest and second-highest number of Chinese buying inquiries of any quarter on record,” she adds.

Chinese Rush To Buy Cambodian Property

According to Law, Chinese buyers would like Cambodia because it is close, offers affordable new luxury homes, has a culture that is similar but different enough to be exotic, has gambling venues and promises possible good returns over the long run because of its rapid economic growth.

“Much of the growth in Cambodian exports is actually due to Chinese firms expanding in or relocating to the country. More Chinese nationals are moving to Cambodia to work in these businesses. They need a place to live and they often have a higher housing budget than the typical local. The growing export markets are therefore driving some activity in residential market,” Law says.

Adding to this, 2Chinese developers are the biggest builders in Cambodia and they developers understand what Chinese buyers want and how to market to them. Among them are big names such as Sino Great Wall, Guangzhou Yuetai Group, Guangzhou R&F Properties, Graticity Real Estate Development, AMC International, Union Development Group, Titan Stone Group and Prince Real Estate Group. For instance Prince Real Estate Group has proposed a ten-year plan to invest more than $6 billion in the creation of a large, new Central Business District in Phnom Penh.

Overall, Cambodia approved over $2.7 billion worth of real estate projects during the first four months of 2019, a 67.3 per cent increase from a year earlier, according to latest available statistics.

Cambodia is growing so quickly that Law assumes it would be “nearly unrecognisable in a decade.”

“We’re talking about massive, transformational change as the country sheds its old, small skin and grows into its new, bigger, richer self,” she says.

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Phnom Penh building construction © Arno Maierbrugger Chinese interest in real estate in Cambodia is booming as Chinese investors seek to tap the growing demand for housing and also look for overseas assets as a hedge against yuan devaluation, market experts say. A thriving job market as a result of the booming economy has boosted demand for housing in the larger urban areas in Cambodia. This has pushed current rental yields to between eight and ten per cent and asset appreciation to 15 per cent per year, making the Southeast Asian nation’s property sector an attractive property bet. The country’s...

Reading Time: 2 minutes

Chinese Rush To Buy Cambodian Property
Phnom Penh building construction © Arno Maierbrugger

Chinese interest in real estate in Cambodia is booming as Chinese investors seek to tap the growing demand for housing and also look for overseas assets as a hedge against yuan devaluation, market experts say.

A thriving job market as a result of the booming economy has boosted demand for housing in the larger urban areas in Cambodia. This has pushed current rental yields to between eight and ten per cent and asset appreciation to 15 per cent per year, making the Southeast Asian nation’s property sector an attractive property bet.

The country’s GDP grew 7.5 per cent and exports surged 17.6 per cent last year, mainly owing to massive inflow of Chinese investment in infrastructure projects on the back of the Belt and Road Initiative, and factories relocating from the mainland to take advantage of the cheap labour and dodge punitive tariffs imposed by Washington in the ongoing US-China trade war.

“Chinese buying in Cambodia has gone from minimal to substantial over the past three years,” says Carrie Law, CEO of Hong Kong-based property portal Juwai.com, a platform for Chinese buyers of international propertie.

“Year-on-year growth in Chinese buying has been climbing by more than 90 per cent per quarter since mid-2017. The fourth quarter of 2018 and the first quarter of 2019 saw the highest and second-highest number of Chinese buying inquiries of any quarter on record,” she adds.

Chinese Rush To Buy Cambodian Property

According to Law, Chinese buyers would like Cambodia because it is close, offers affordable new luxury homes, has a culture that is similar but different enough to be exotic, has gambling venues and promises possible good returns over the long run because of its rapid economic growth.

“Much of the growth in Cambodian exports is actually due to Chinese firms expanding in or relocating to the country. More Chinese nationals are moving to Cambodia to work in these businesses. They need a place to live and they often have a higher housing budget than the typical local. The growing export markets are therefore driving some activity in residential market,” Law says.

Adding to this, 2Chinese developers are the biggest builders in Cambodia and they developers understand what Chinese buyers want and how to market to them. Among them are big names such as Sino Great Wall, Guangzhou Yuetai Group, Guangzhou R&F Properties, Graticity Real Estate Development, AMC International, Union Development Group, Titan Stone Group and Prince Real Estate Group. For instance Prince Real Estate Group has proposed a ten-year plan to invest more than $6 billion in the creation of a large, new Central Business District in Phnom Penh.

Overall, Cambodia approved over $2.7 billion worth of real estate projects during the first four months of 2019, a 67.3 per cent increase from a year earlier, according to latest available statistics.

Cambodia is growing so quickly that Law assumes it would be “nearly unrecognisable in a decade.”

“We’re talking about massive, transformational change as the country sheds its old, small skin and grows into its new, bigger, richer self,” she says.

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