Logo of Phnom Penh Post newspaper Phnom Penh Post - Wait-and-see owners fuel an already fickle market



Wait-and-see owners fuel an already fickle market

Wait-and-see owners fuel an already fickle market

WITH an abundance of properties on the market as a result of the construction boom, you would think that it would be a true buyer’s market in Siem Reap, but the market does not always function according to the usual rules.

The roads in and out of Siem Reap are a testament to the massive expansion the town has seen in the last few years.

Bruno L’Hoste has lived in Cambodia since 1995. He first arrived here as a photographer based in Phnom Penh, then moved to Siem Reap, and in 2003 established the acclaimed Tigre de Papier, one of the first restaurants on Pub Street and still thriving today.

He has witnessed and experienced the different phases Siem Reap has gone through.

“The real estate boom in Siem Reap really began with UNTAC.Then you could build a big 4-6 bedroom villa for US$50,000 to $60,000. When you had all these guys coming into town with huge salaries, who didn’t care what they were paying, the owners of the villas were asking for huge rents for their properties, up to $6,000, and a year in advance, and they were getting it,” said L’Hoste.

“They were then using that money to build another villa and renting that out, and so on. It was crazy because there were too many people with too much money. Today those villas are still there, but now they rent for $1,200 to $1,300.”

However, there is not much of a market for them, says Vong Thinonn, of Cambodia Angkor Real Estate. The properties that rent out quickly now are those at $400 to $500.

“The market is very strange”, says L’Hoste. He points to a photo for one villa he has just succeeded in renting out.

“It took more than three months to rent that out”, he says of a three-bedroom villa on the outskirts of town that went for $1,300, while slightly further out, however, it’s possible to rent five-bedroom villas with gardens for less than $500. In town, it’s even possible to rent a 16-bedroom guesthouse for $1,500 per month.

Having seen the high returns they could get at the height of the boom in 2008, owners are extremely reluctant to adjust their prices to prevailing market forces.

“They would rather see the property go empty for two or three years than drop their prices. This is a problem for the owners, too, because we’re in the tropics, the concrete deteriorates and everything goes bad,” L’Hoste said.

A good example of the glut in shop-house developments in Siem Reap is the Charming Tourist City on the road towards Angkor Wat. Construction on this mini-complex started more than two years ago, and today there must be almost 200 units, more than two-thirds of which appear to be empty, with printed “To Let” signs on their windows.

This complex alone and many others like it should have led to a significant drop in rental prices in Siem Reap but it hasn’t. Normal market forces don’t operate in the face of owners’ pride.

MOST VIEWED

  • Kingdom's Covid cluster cases jump to 194

    The Ministry of Health on February 25 confirmed 65 new cases of Covid-19, with 58 linked to the February 20 community transmission. The latest cluster cases include nine Vietnamese nationals, five Cambodians, one each from Korea, Singapore and Japan, with the rest being Chinese. This brings the total number

  • Locations shut, dozens more Covid-19 positive

    The Ministry of Health has closed 23 locations in connection with the February 20 community transmission of Covid-19 and summoned for testing anyone who had direct contact with affected people and places. The number of discovered related infections has risen to 76, including 39 women. In a press release,

  • Cambodia's Covid cluster cases rise to 137

    The Ministry of Health on February 24 recorded 40 more cases of Covid-19, with 38 linked to the February 20 community transmission. Of the 40, two are imported cases involving Chinese passengers. The 38 include two Vietnamese nationals and one Cambodian, with the rest being Chinese. This brings the total cases

  • Covid cluster raises alarm, health bodies urge vigilance

    The Ministry of Health and the World Health Organisation (WHO) in Cambodia have expressed great concern over the February 20 cluster transmission of Covid-19 in the community. Both entities appealed for vigilance and cooperation in curbing further spread of the virus. Ministry spokeswoman Or Vandine said

  • PM confirms third Covid-19 community transmission

    Prime Minister Hun Sen on February 20 announced the Kingdom's third outbreak of Covid-19 community transmission after 32 people tested positive in just over 10 hours. Addressing the public from his residence after an emergency meeting, Hun Sen said: "I dub it February 20 Community Event, in which 32 cases

  • Cambodia to make auto-rickshaws

    Locally-assembled electric auto-rickshaws could hit the Cambodian market as soon as early in May after the Council for the Development of Cambodia (CDC) gave the greenlight to an investment project at the weekend. According to a CDC press release, it will issue a final registration