Feb. 16, 2017, 11:45 a.m.
Phnom Penh: Mr. Kim Heang, president of the Cambodian Valuers and Estate Agents Association (CVEA), has urged the government to regulate property transactions in the upcoming Management Law and educate private property sellers as a means to control market price fluctuations running out of control in 2016.
The initiative would mimic the US model in theory, making all property sellers bound to use a registered real estate company in order to sell their property. The proposal is intended to control the unfounded price hikes throughout the local market, and ultimately stem speculative fluctuations in aggregate market prices. More accurate property valuations would lead to a more sustainable market place, and grant local and international investors greater confidence to buy in.
“Nowadays the property owner can easily make their own 'House for Sale or Land for Sale' sign,” says Heang. “Generally, when a private seller attempts to sell their own property, however, the price they seek in 30 to 50 per cent higher than market value.” This makes it very difficult to buy and sell, Mr. Kim Hang added, and creates unfounded speculation in the market.
Hence, the CVEA is calling the Government to educate the market to these problems before they create the new Management Law.
Mr. Kim Heang’s solution to these speculative bubbles from private sellers is to regulate that “all property owners should sell their property via the consultation of a registered real estate agency.” This will allow selling prices to better match the market price. And in doing so, will ultimately control real estate prices running out of control, and make the market more stable and sustainable, suggests Heang.
Heang also added that “in many other developed economies, the real estate market management law demands the owner sell their property via an expert real estate company for this reason.”
Mr. Bo Eavkong, general manager of the Asia Real Estate company, said that real estate companies currently have no right to force the property owner to consult with a real estate company when deciding their property value. "The first step is the Government educating people and urging the property owner to seek guidance from real estate professionals and trained valuers. Gradually, then the real estate sector will strengthen in terms of professional ethics."
He added that, “if they want to sell their property for a reasonable price and sell it, they only need to spend 160$ for the fee of the expert real estate valuation. Meanwhile, selling over the market price is much more difficult, stalling the market,” says Bo.
Mr. Khom Monyroth, consultant manager of Daily Realty Group, has agreed with what Mr. Bo Eavkong said, adding that education is a good start. “Even if the property owner studied the real estate prices of 4 or 5 other similar properties in the same area, they will automatically have a better understanding of the price at which their property will most likely sell for.”
He also said that any “announcement or education won’t take effect immediately. Still, serious real estate investors must contact real estate agents if they want to succeed in the market. If you consult with a real estate company, you will understand that it is impossible to sell your property too much over the market price.”
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