Taking the leap into the property market for the first time can often be a daunting prospect, with an abundance of property types available. However, with adequate preparation and research, this prospect and process can be simplified and rewarding.
Last week in 'Tips for Property Investors - Part 1', we examined the importance of identifying your purpose and began looking at how to examine a property’s investment potential. This week we will delve deeper into the evaluating potential and protecting your investment in the long term, thanks to Realestate.com.kh!
Further examination of the property’s potential:
Aside from embarking on research on your proposed property and factoring in other costs associated with your investment, such as maintenance and business fees, it is also important to note that some developers in Cambodia now also offer guaranteed rental returns for a specific duration after a residential unit is turned over to you. This can offer you financial security for the first few years after your investment.
You should also look into other new developments in Cambodia being constructed and surrounding infrastructure in your proposed location. Any major changes in these two aspects will impact the value of your chosen property over time.
Protecting your investment:
Looking at whether your potential developer is reputable is key to protecting your investment and can be established by making some simple inquiries. Asking for specific details about the developer’s site plan, and whether they have insurance and property management services will eventually make a big difference during disputes and natural calamities – things outside of your control.
A final factor to consider is obtaining independent legal advice, or at least establishing a full understanding of the laws relating to your proposed investment - see Realestate.com.kh's Guide for First Time Cambodian Investors for more information.
Take for example the strata titling in Cambodia. Foreigners are only legally allowed to own properties through strata titles. But this also has legal restrictions, stating that a foreigner can only own up to 70% of the co-owned building. If you are being offered an investment opportunity that does not take into account property laws – such as the example above, it can affect the legitimacy of your title to your property, which can leave you without remedy if a dispute were to arise.
Ultimately when it comes to investing in Cambodia for the first time, a clear investment purpose, doing your research on a property’s potential and looking thoroughly into the legalities and reputability of your developer are all necessary steps to take to ensure you make a smart and rewarding investment choice.
Want to learn more about investing in Cambodian Property, read our article Why invest in Cambodian Property or visit Realestate.com.kh for more information