Are you a foreigner browsing the Cambodia property market report for a possible investment? The Cambodian real estate market is very much alive and it’s a great time to purchase a property.
However, as much as foreigners can own properties in Cambodia, there are strong restrictions. Below, we outlined some of the key points you should know:
You can’t own land
Like its neighboring countries like the Philippines and Vietnam, Cambodia doesn’t allow foreigners to own a landed property. Instead, you can only go as far as owning a condo. Nevertheless, there are tricky ways to purchase land in the country but these aren’t without its risks.
The best way to purchase a land property is to acquire Cambodian citizenship. However, this isn’t an option for many foreigners. What others do is purchase the land through a Cambodian nominee.
The nominee is a bonafide Cambodian citizen that will buy the land under his or her name but gives you full control of the property.
So is it safe to purchase a property through a nominee? Technically, it’s not 100% risk-free. The nominee may run away with your property or the government may confiscate it from you. This is a rare thing in the Cambodia property news but it can happen.
How to acquire a title when buying a condo
When it comes to buying a property in Cambodia, there are four title types: soft, hard, strata, and LMAP. Most foreigner buyers will hold strata title as it’s awarded to condo units, playgrounds, swimming pools, and other similar properties.
But if the condo building has a strata title already, you can apply for a soft title. These titles are recorded on the local level only but it’s widely recognized and preferred by unit owners.
Soft titles allow easier transfer of property. However, you can’t secure a mortgage under this title. It’s best that you acquire a hard title instead.
Hard titles offer better protection on your ownership of the property. Although it’s not easy to acquire, the hassle is totally worth it.
The process of purchasing a property
Staying in tune with real estate news in Cambodia is good, but you should know more about the process before buying a property.
Once you have a prospect property, conduct a title search with the help of an agent. This is to ensure that the property doesn’t have any complications.
You should also contact the local Commune council to know more about the property you’re planning to purchase.
If the property you’re buying is from a company, make sure that you acquire a photocopy of the ID of their representative.
After that, a 10% deposit would be required to reserve the property or depending on the setup between the seller. The Cadastral Office will then process the documents which may take months.
Once you have the documents, you will be prompted to pay for the transfer tax. You can look for the Cambodia property market report to know how much you’re going to pay for taxes.