No sign of over-supply as Cambodian wealth increases and Chinese interest remains high
Borey sales are doing well despite uncertainty ahead with the forthcoming national elections and the market is expected to keep growing even as more projects come on line, industry experts say.
“The growth in GDP per capita and the increase of the population are the factors that are contributing to the positivity of the borey market,” said Van Chantthorn, managing director of TOWNCITY Real Estate Company. “If the completed projects were not selling, you would not be seeing more projects coming onto the market. The big borey developers are actually expanding.”
Boreys, a Khmer description of a gated community, have proved very popular among Cambodia’s high-income earners since the first projects started in 2000, and developers are now targeting even the middle class.
A study by Vtrust Appraisal estimated that the Kingdom had around 500 borey projects at the end of 2017, containing about 125,000 homes.
“We haven’t studied 2018 yet, but all signs are that transactions are still doing well,” said Hoem Seiha, director of research at Vtrust.
According to property experts, houses priced in the $30,000 to $60,000 were doing best in the market.
Dr Kim Heang, president of Cambodian Valuers and Estate Agents Association, warned, however, that developers needed to maintain standards and quality to ensure projects sold out fully.
“The top projects, the famous ones, are succeeding as they have already earned trust from their customers,” he said. “Those who do not value quality and are not attentive will fail. “This is normal in a free market mechanism. If you don’t pay attention, if you are weak, you will fail.”
Oknha Ly Hour, president of Housing Development Association of Cambodia and the owner of Borey Vimean in Phnom Penh, said sales were going well and there was no sign of over-supply.
“Chinese investors coming in have contributed to the growth of this sector throughout the whole country,” he said.
He saw the biggest risk to borey developers was finding the manpower necessary to complete projects. “Along with the speed of this rapid development, we also have some risk as we now lack technical experts and construction workers.”