shophouse cambodia tips real estate
Updated on: August 31, 2023, 6:37 a.m.
Published on: August 31, 2023, 5:05 a.m.

Tips When Buying Shophouse in Cambodia

When exploring property options, you will undoubtedly come across shophouses. Regardless of whether they are newly built or old, they represent a unique property type that can be found all over Southeast Asia, and Cambodia is no exception. However, the question arises: What are the key considerations needed when purchasing shophouses? In this article, we will explain various types, locations, and property histories.

Types of Shophouses 

Shophouses are possibly the most desired property for Cambodians, due to their versatility, whether it be a business, home or even both. A shophouse layout comes in many shapes and sizes, however, they are generally a standard size of 4 metres by 16 metres (13 feet by 52 feet). Generally, these shophouses are two, three or four floors high, with a long and narrow layout. Shophouses sit in a row and share a joining wall with the neighbouring house. A traditional shophouse usually has a narrow frontage and extends deep into the block. It has a ground-floor commercial space, and the upper floors are used for living quarters. In contrast, modern shophouses often have wider frontages and more floors, in some cases, a mezzanine is also a feature of shophouses making them suitable for larger commercial enterprises. These unique properties offer the best of both worlds: a storefront or commercial space on the ground floor and residential living quarters on the upper floors. 

Strategic Location 

Location is a crucial factor when buying a shophouse in Cambodia. Ideally, a shophouse in a bustling commercial or the potential of an area with high foot traffic for example. If you are buying a shophouse in a borey, look at the main arterial roads or the proximity to these roads, as they will receive the most trade on completion of the project. Shophouses in areas with a mix of retail shops, restaurants, and other commercial establishments, will attract more customers to business. In Phnom Penh, popular areas where you can find shophouses are Daun Penh, Orussey and Sen Sok

Property’s History 

Many shophouses in Cambodia are old and historic, and it's essential to research the property's history before making a purchase. In case the property has been in existence for a long time, it is recommended to seek advice from a property consultant to find out if the building has undergone any renovations or restorations, and most importantly if it is listed as a heritage building. It is also important to consider that old shophouses generally do have only soft titles as a certificate of ownership. A soft title has the advantage of being easy to transfer, at a cheaper price and there is no need for transfer tax, however, it might not be the strongest form of title ownership. Luckily, not all shophouses in Cambodia are old. Developers have been constructing modern shophouses that are equipped with more floors and wider frontages, modern interior design and space for businesses. Generally, new projects come with hard title ownership. Regardless, of its year of construction, it is essential to verify the ownership title it holds prior to purchase. To find out more about the available offers, click here.

Overall, investing in shophouses offers several advantages, with a prominent one being their potential for capital appreciation. This is driven by their mixed-use flexibility, which attracts a wide range of buyers and tenants. Shophouses are often positioned in prime locations, often near essential amenities and transportation hubs. This also presents an opportunity for rental income through their commercial spaces, further enhancing their appeal as a sought-after property investment.

The process of buying and selling real estate in Cambodia can be overwhelming, especially when buying a property it is advised to conduct due diligence on the property's title and measurements. Once both parties have agreed on the negotiation terms, a Sales and Purchase Agreement (SPA) should be drafted. To ensure a smooth transfer of ownership, it is recommended to engage a real estate agent to handle the transfer of documents and liaise with the relevant ministries and with payment matters.

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