Before the recent construction boom, small real estate agencies were scattered throughout Phnom Penh. These small, often unregistered companies with few staff found a niche in the market primarily through word of mouth and referrals from previous clients. However, as property demands have risen, smaller agencies face the decision of whether to join international conglomerates or collaborate with online portals to reach their client base.
Within the real estate market, both small and large agencies work towards connecting the demand of the clients with the supply that is available, with networking being the key to a successful business.
Which is why, according to Kevin Goos, CEO of Century21 Cambodia, as more international real estate companies enter Phnom Penh’s market, the need for having an online presence is imperative.
“In more advanced countries, 90 per cent of people interested in purchasing real estate go online first before contacting a broker,” he said. “We see Cambodia going in the same direction.”
“Traditional real estate agents in Cambodia are more accustomed to just showing a client a property and hoping they buy, however, more professional real estate companies in Cambodia offer a professional service such as online real estate listings and presentations,” Goos added.
This means that smaller agencies that rely solely on references from former clients may loose their competiveness to more established, international companies that appeal to foreign investors. Unregistered and semi-professional companies are those at the greatest disadvantage.
“They are the main obstacle for increasing the level of professionalism for the local agents in Cambodia,” said Goos. “However, with Century 21 and more international real estate companies entering Cambodia, the unregistered companies are slowly leaving the market.”
A former employee of an unregistered agency, who wished to not be named, said that they have felt the impact of the shift in the real estate market. At their former company, all clients and owners were met offline, and without having the resources to reach a larger clientele, the company struggled to generate the profits to break even.
Meanwhile, smaller agencies that have adopted online platforms claim that they have benefited.
Sam Kiers, director of sales and marketing for Elevated Realty Co., for example, said that the company began working with the new online platform realestate.com.kh.
“[Working with them] only enhances our business,” he said.
Yet, a strong offline network remains a key factor for compiling a substantial database of Cambodian landlords and landowners who have available properties.
According to Khannarong Un, sales director of Elevated Realty Co., the success of the one and a half year old company still relies heavily on the contacts he has made in the 11 years that he has been involved in the market.
“I have a lot of network with landlords, and we have collected it in our database, and then the second aspect is that the owners know us, so they call us when they have available space,” he said.
Now, with the increasing presence of online portals and offline contacts that have built up over decades, real estate agents can more easily network.
“These portals are a main touch point for clients to find your property listings, that’s where it starts, not where it finishes,” Kiers said.
With the demand side being served much more easily online, clients’ style and preferences clients has shifted back into focus.
For Khannarong and Kiers, the issue they face in the market is finding adequate apartments or homes for their Western clientele.
“There is a lack of Western architecture or Western style [decorations and furniture]. We have a lot of requests from our clients that we keep documented, and many of them are very similar. Of course their budget differs, but what western clients usually search for is natural lighting, ventilation, big living rooms, balconies and air conditioning.”
Meanwhile, the small agencies that are neither online nor ready to join a conglomerate of agencies such as Century21, are also missing the shifting trends in the market.
“If [property owners] really want to lease or sell their properties listed, they have to really try to make it work with the clients’ [need], which is a furnished apartment with a more modern style, which will also end up cheaper for the [property] owner rather than investing in, say, hard-wood,” Kiers said.
Meanwhile, without being able to reach a large client base, small, offline agencies may not be aware that they don’t have the type of properties that the majority of clients are looking for.