Prices for borey homes have increased around 10 to 20 per cent in the first quarter of this year compared to the same period of last year, according to a study conducted by World Trust Estate.
Up until the first trimester of this year, the study included houses that where at least two-stories high. The price of those houses was based on the type of housing such as flats, shop houses, twin villas and single villas.
As the reason to why single villas sold slowly, the study cited that the price range exceeded the majority of potential homeowner’s financial capability.
Yet, despite slow villa sales, prices picked up 10-20 per cent on average.
But why is that so? Post Property asked borey developers and property experts about what caused the increase.
Dr Penghong Socheat Kemro, general director of the housing department of the Ministry of Land Management Urban Planning and Construction, said that last year’s demand for new housing in Cambodia was around 10,000 to 20,000 units. This increase was due mostly to young, newlywed couples who started families in their own homes.
Chhay Sina, head of marketing and sales in Borey Vimean Phnom Penh, said prices went up because designs were more attractive while developers grew a reputation for quality.
She continued that “trusted and better infrastructure helps increase the sales gradually,” while “paying attention to good quality of building and house design also share a part in [the increase].”
Despite higher prices Chhay’s company increased sales 15 to 20 per cent in the first quarter of this year compared to the same period of last year.
Nget Piseth, a director’s assistant at Borey New World, added that it was not only new couples, but a growing economy that added to the price increase. He repeated the notion that boreys have faced problems keeping prices stable. “I cannot expand into new projects because land prices have increased,” he said.
Construction material more expensive
Teng Rithy, a general manager of Borey Town said the sale prices in Borey Town slightly increased this year because the company faced some problems as sand prices surged (Post Property reported), as well as the prices for stone and steel.
En Sitha, deputy general director of World Trust Estate, told BTV, that prices for housing were also picking up because getting a bank loan had become much easier (Post Property reported). Sitha also added the financial sector was greatly encouraging the development of real estate.
He added that people’s increasing income obviously had an effect on borey homes becoming more expensive as well.
Despite all the reasons that allowed prices to go up, Seng Bunna, general director of Bunna Realty Group, agreed with the statement that the growing economy and easier access to finance affected borey prices. He pointed out, however, that borey projects mostly focus on higher middle class citizens and the actual number of those who could afford borey housing was still much lower than perceived. Wishing for a downshift in the market, he told Post Property that constructing housing for lower- middle class and even lower class citizens would be a good idea because many more people actually fell into that category.