THE Kingdom’s property sector is beginning to emerge from the global financial crisis, but could further improve with the implementation of anti-corruption laws and enforcement of property rights, according to industry experts.
Although the sector is some ways off the pre-crisis peaks experienced in 2007, the number of transactions are on pace for a 10 percent increase this year on 2009, said Cambodian Valuers Association President Sung Bonna.
“Cambodia’s real estate market remains on track for a robust recovery and we expect foreign investment to continue to be a key driver of growth for the sector in 2011,” he said at the 17th annual ASEAN Valuers Association seminar held in Siem Reap on Friday.
Government tax revenue from property related transactions surged 60 percent from US$12.2 million in 2009 to $19.5 million the following year, according to the Ministry of Urban Planning and Construction figures presented by Sung Bonna at the seminar.
However, some impediments remain to the sector’s growth, such as corruption and poor enforcement of property rights still remain, he added.
“The government have tried to work very hard [to enforce property rights], and it’s improving by the year, but they need to collaborate with the private sector to improve the law,” he said.
With the formation of the anti-corruption law and the launch of the Cambodia Securities Exchange, Sung Bonna said he expects improving legislation within the Cambodian property market to draw further foreign investment.
Asian Development Bank officials echoed claims anti-corruption laws was likely to strengthen Cambodia’s investment climate and enhance confidence among the business community.
“The new anti-corruption law plays an important role in improving public sector governance and therefore, reducing corruption in Cambodia,” ADB External Relations Coordinator Sothea Ros said.
Phnom Penh-based property agents also expect increases in foreign investment with improvements to the regulatory environment.
“When investors consider whether or not to invest funds in any country, the degree of transparency is a key factor in their decision-making process,” CBRE Cambodia Chartered Surveyor Ryan O’Sullivan said.
“The perception of land expropriation needs to change so that land owners feel secure in their land purchases.”