Logo of Phnom Penh Post newspaper Phnom Penh Post - Housing loans up in 2013, growth expected to continue in ’14



Housing loans up in 2013, growth expected to continue in ’14

Loans for home purchases and home improvements are growing quickly.
Loans for home purchases and home improvements are growing quickly. BRENT LEVIN/BLOOMBERG

Housing loans up in 2013, growth expected to continue in ’14

Last year across Cambodia’s cities, more and more people decided to take the plunge and invest in housing.

This should be obvious to anyone who lived in Cambodia last year. The sounds of construction or renovation were more noticeable than before in cities across the Kingdom.

Data from Cambodia’s largest commercial bank backs up this anecdotal evidence. The total amount of loans provided by ACLEDA Bank for housing purchases in 2013 was up nearly 15 per cent year-on-year, breaking the $100 million mark for the first time.

ACLEDA Bank senior vice-president and credit division director Inn Siphann told the Post that housing loans in 2013 totaled $107.3 million, up 14.6 per cent over 2012’s $93 million.

There was also a considerable increase in lending by ACLEDA for home improvements, Siphann said. In 2013 the lender provided $57.7 million in home improvement loans, compared with $45 million the previous year, translating into an increase of 28.2 per cent, he added.

Siphann said that there was no reason to expect a slowdown in the purchases and renovations of homes in 2014.

“Housing loans in 2014 will continue growing because of several factors such as continued economic development, population growth, more newlyweds, and movement of people from the countryside into cities and boreys,” he said.

Content image - Phnom Penh Post

ACLEDA provided loans to 13,439 people last year, a nearly 25 per cent jump from 10,778 loan recipients in 2012.

Dr Bun Mony, Cambodia Microfinance Association director and CEO of microfinance institution Sathapana Limited, said the emergence of microfinance institutions and banks to support growing interest in housing investment is a positive development for Cambodia.

It allows those with the desire but not yet the means to purchase a home or improve their existing home, while contributing to the healthy development of the Kingdom’s property and construction sectors, he said. Low interest rates have been crucial to this development.

“Interest rates in the banking and microfinance industry in Cambodia are lower than those found in neighbouring countries,” Mony said. “It has hovered between one and two per cent, which is a positive sign.”

Key Real Estate general manager Sorn Seap said that banks played a vital role in the developing property sector. Low interest rates, long payback periods and rising incomes have brought the possibility of home ownership to a much larger percentage of the Kingdom’s population, he said.

That said, Seap believes interest rates could be lower still. “With lower interest rates, more people would be able to invest in the property sector through housing loans,” he said.

MOST VIEWED

  • Angkor lifetime pass, special Siem Reap travel offers planned

    The Ministry of Tourism plans to introduce a convenient, single lifetime pass for foreign travellers to visit Angkor Archaeological Park and potentially other areas. The move is designed to stimulate tourism to the culturally rich province of Siem Reap as the start of the “Visit

  • Ice cream, noodles flagged over carcinogen

    The General Department of Customs and Excise of Cambodia (GDCE) has identified three types of instant noodles and ice cream trademarks originating from Thailand, Vietnam and France that are suspected to contain ethylene oxide, which poses a cancer risk to consumers. The general department has

  • Exclusive interview with Josep Borrell Fontelles, High Representative of the EU

    CAMBODIA is hosting the 55th ASEAN Foreign Ministers’ Meeting (AMM) and Related Meetings this week with top officials from the US, China, and Russia and other countries in the region slated to attend and to meet with face-to-face with their counterparts on the sidelines. In

  • Rise in Thai air routes to Siem Reap fuels travel hopes

    Local tourism industry players are eager for regional airline Bangkok Airways Pcl’s resumption of direct flight services between the Thai capital and Siem Reap town on August 1 – home of Cambodia’s awe-inspiring Angkor Archaeological Park – which is expected to boost the growth rate of

  • ASEAN Foreign Ministers’ meet commences, Taiwan issue possibly on table

    The 55th ASEAN Foreign Ministers’ Meeting (AMM) and related meetings hosted by Cambodia kicks off in Phnom Penh on August 3, with progress, challenges, and the way forward for the ASEAN Community-building on the table. Issues on Taiwan, sparked by the visit of US House Speaker

  • Recap of this year’s ASEAN FM meet and look ahead

    This year’s edition of the ASEAN Foreign Ministers’ Meeting (AMM) hosted by Cambodia comes against the backdrop of heightened global tensions and increasing rivalry between major powers that have been compared to the animosity of the Cold War era. The following is The Post’