Phnom Penh land prices rise in first quarter

Phnom Penh land prices rise in first quarter

5 New Housing

Land prices in Phnom Penh, particularly along the large boulevards which are active commercial areas, increased by 5 to 10 per cent during the first quarter of this year, said real estate experts.

Khat Sovann, general manager of the Cam Top Property Group, said land prices in Phnom Penh grew between 3 and 5 per cent during the first quarter and the price could rise to 10 per cent in the third quarter of 2013.  

However, land prices will not increase further than this, while the real estate sector is moving forward gradually, not growing quickly as before the global economic and financial crisis in 2008, he added.

Today for a plot of land having a market price of $1 million, no one would dare to offer between $1.35 million and $1.5 million, which is different from before 2008, when, for a plot of land having a market price of $1 million the customer would offer from $1.5 to $2 million, he said.         

He said that “this time people do not dare to ask for much more than the market price, as they usually listen to the information and consult with real estate experts first, not coming up with high prices on their own.”

Currently land prices in Boeung Keng Kang I area is from $2,300 to $3,000 per square metre, while in Daun Penh district it is between $1,800 and $2,500 and in Tuol Kork it is between $1,500 and $2,000 per square metre.  

However, Po Eav Kong, managing director of Asia Real Estate has a contrary viewpoint, saying that land prices in Phnom Penh have risen slightly, but there is a new trend of real estate owners demanding higher prices, which makes some investors wait and study opportunities before starting their investment.

But this trend of demanding higher prices is not yet as bad as it was in early 2008, he added.

He said “the growth and the demand for higher prices, above the market, is as a result of the influx of investors and the activity of buying and selling land.”

Sorn Seap, general manager of Key Real Estate said that in the first quarter of 2013 land prices in Phnom Penh rose only 5 per cent compared with the end of 2012. Land price in some areas in Phnom Penh increased but some areas did not increase.

In the second quarter of this year land price could rise slightly more than this because of growing demand and growing activities for rent, purchase, and sale.

He confirmed that “the important factor that helps boost the growth of land price this time is because of the growing economy in Cambodia, the open market policy, and the income of the people is also increasing, leading to more demand for properties,” He told Post Property; “This time a lot of big companies from Japan and the US are coming to Cambodia, which is a sign telling domestic people to be ready to compete and strengthen their own capacity further.”

Kim Heang, president of Khmer Real Estate is more optimistic than this, saying that land prices in central Phnom Penh, particularly along big boulevards Like Norodom Boulevard, Preah Monivong Boulevard, Sihanouk Boulevard and the Russian Federation Boulevard increased between 20 and 30 per cent. But land prices in the provinces did not increase despite increasing buying and selling.

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