Up Close With: Ross Wheble, Knight Frank
Cambodia Begins at 40 gets up close with Ross Wheble of Knight Frank to discuss the state of the Cambodian property market.
Thanks for agreeing to the interview. First of all, could you give us a quick background about yourself and Knight Frank.
Initially from the UK, I first moved to Asia in 2010 to Malaysia where I worked for three years before relocating to Cambodia. I’m a trained Chartered Surveyor with the Royal Institution of Chartered Surveyors, and I’m now a partner here in the Knight Frank Cambodia office. I have a Cambodian wife and a 2.5 year old boy so I’m here for the long term!
Is there a Cambodia Real Estate Bubble?
I wouldn’t necessarily say a bubble but there is certainly an oversupply across almost all sectors, and we are seeing the market slow down. I believe there will be a period of stagnation where prices will remain relatively flat for several years until the oversupply is absorbed into the local market.
What do you think will be the trend for Cambodian property prices in 2023?
Is the boom over? The boom is certainly over, with FDI from China – the main source of FDI into Cambodia – unlikely to return to pre-covid levels. For any real estate sector to be sustainable, it needs to be underpinned by domestic demand. As above, we anticipate a period of stagnation with prices remaining flat until the domestic spending power increases to drive demand for across the various real estate sectors.
Are there any up and coming areas?
The southern growth corridor, which includes Hun Sen Boulevard and the wider 2,500 hectare ING City project, Chbar Ampov and Koh Norea, will be Phnom Penh’s major growth area over decades to come, especially with the new international airport being developed to the south of the city, and Takhmau is likely to become part of a Greater Phnom Penh. We also anticipate more development on the Mekong East Bank now that the bridges connecting Areyksat with Chroy Changvar and Chbar Ampov have been publicly announced.
Where would you advise people to buy property in Cambodia?
In any country, I would always recommend investors to buy in the capital city as you are much less likely to have long void periods and price growth typically outperforms the country level growth. On top of that, riverfront property is a good choice as there is a finite supply of riverfront land.
What type of property would you advise them to buy?
This is very much dependent on budget but with the introduction of the Trust Law in Cambodia it is now very easy for foreigners to buy land. Right now with the current state of the market, I would recommend buying land in strategic locations where infrastructure projects have been announced.
How can people buy property in Cambodia?
Foreigners are able to own freehold strata title units outright, such as condominiums, from the first floor and above which has feulled the construction of many projects. Alternatively, under the new Trust Law, buyers can also purchase landed property with nominal holdings fees.
What are important things to look for in an investment property?
Aside from location, location, location, one thing to certainly consider is your investment timeframe. With a very weak secondary market for both condominiums and houses, investors need to have realistic expectations for their exit strategy which should be a minimum of five to seven years. With condominiums, another key thing to consider is property management and how well the building is maintained. Developments with a low management fee is a red flag as the management fees being collected are unlikely to cover the cost of maintaining the building to a satisfactory standard.
As regards rental, what type of property would you advise people to rent?
This really depends on each individual’s requirement, with larger families typically preferring to rent a house over a condominium and vice versa. Schools also play a key factor in terms of which area you will be looking to rent in and what kind of stock they have in each location. Others may prefer a serviced apartment where weekly services include cleaning and linen changes.
How should they go about renting property in Cambodia?
Approaching reputable, licenced real estate agents such as Knight Frank is always the best option. We provide full orientation tours, as well as a relocation guide, for expats looking to relocate to Cambodia at no cost. We have a deep understanding of the market and can quickly narrow down locations and properties once we know a clients’ criteria, taking away the hassle of searching for hour online.