The recent boom in Cambodian real estate investment, is it pie or trap?

With more and more investors turning their eyes from the old developed countries such as Britain, America and Australia to the Southeast Asian market, it is undeniable that people's investment thinking is more and more advanced, and the end of the considerable development of Southeast Asian countries has been recognized. Many countries, led by Thailand and the Philippines, have taken the lead and become the first destinations for many investors to test water. But it has to be said that the results are also good. Many people in these markets have constantly tasted sweetness, but they have not been satisfied. They have begun to try to open up more and deeper real estate investment markets.

Recently, a ''black house country '' that invests in real estate has come out of control, causing considerable ups and downs in the investment circle. Its supporters and opponents are equally powerful. This country is Cambodia.

Come and talk with you when you have a way today .Is it ''pie''or ''trap'' that Cambodia's  real estate investment is so popular these days?

Cambodia is too poor!Who invests insect a poor place?

Is Cambodia poor? Poor! No one can deny that the country's per capita annual GDP is only $1,260, and the median household income in Phnom Penh, the capital, is about $11,000, less than a third of that in Shanghai. But it is such a country that is becoming one of the fastest growing markets in the world.

But if you keep looking  at Cambodia in this way ,it's the same way that European and American countries looked at China in the 1990s.

Many people take Cambodia's Phnom Penh as a comparison with China, which was advancing vigorously 20 or 30 years ago. Cambodia's economic growth rate in the past 20 years has reached 7.7%, ranking sixth in the world. It relies on the huge demographic dividend, which is closely related to China's rapid development in that year.

So, poverty is the stage of a country's development after all. Cambodia today, like the western United States, which set off the gold rush in 1849, and China, which opened up and opened up in 1978, is at the beginning of a new round of prosperity.

I heard the political situation in Cambodia is turbulent. Too unsafe!

It may be understandable to say that Cambodia's poor people, after all, only last year did the country take off the hat of "the world's poorest country", but if Cambodia's evidence is unstable, it must not have a good understanding of the current situation of the country!

2018 marks the sixtieth anniversary of the establishment of diplomatic relations between China and Cambodia. At the same time, Cambodia also ushered in the most important political agenda: the sixth national election. There is no doubt that Hun Sen has been elected again in succession to begin his 30-year reign, which undoubtedly gives investors great confidence.

In fact, not only is Cambodia politically stable, but the situation of Chinese people in the region is probably the best not only in Southeast Asia, but also in Cambodia's history.

How close are Cambodia and China? Former King Sihanouk of Cambodia lived in China before he died in Beijing. Now Prime Minister Hun Sen's wife is a descendant of Hainan. During the Qingming Festival, his wife and his family returned home to worship their ancestors in accordance with the Chinese tradition. Hun Sen himself, a typical advocate of Deng Xiaoping Theory, is learning from the successful experience of 40 years of China's reform and development.

With China becoming its largest source of foreign investment, the relationship between China and Cambodia has begun to be closer than ever before.

In 2017, Cambodia attracted 183 overseas investment projects , with a total investment of US$6.3 billion , up 75% from the same period last year, which was the largest attraction of foreign investment in the past 5 years , with China as the main source of investment.

Political stability, good relations between China and Cambodia, the most important thing is that Cambodia maintains a very friendly attitude towards investment in China and the Chinese themselves. If investment lacks these, the motivation will be greatly reduced.

"I am very optimistic about Cambodia's future development, whether in the national political situation or in China's relations, is a good investment."

For those who think that Cambodian real estate investment is a "trap", most of the main doubts stem from the lack of understanding of the current situation in the country, but in fact, what are the "little secrets" behind such hot Cambodian real estate investment?

Rising Land Prices and the Rise of Phnom Penh, the Capital.

According to CBRE (Cambodia), one of the five largest real estate investment banks, land prices in Cambodia have soared by 225% in the past 10 years. Cambodian land prices are expected to grow at an annual rate of 7% in the next 10 years.

This forecast is based on supply and demand trends, and similar to Thailand and Vietnam. At the same time, factors such as peace and stability, economic growth, infrastructure improvement and population factors are taken into account.

Phnom Penh, the capital of Cambodia, is the main destination for investors to invest in Cambodia. In the second quarter of this year, the price of high-end apartments in Phnom Penh reached $3200 per square meter, 60% higher than five years ago. The land price in Longbian District, a high-end business district, is more than 9,000 US dollars per square metre, almost three times as high as in 2014.

The soaring price of land is sometimes more exciting for investors than the soaring price of house. Land, as the support of real estate, can be said to be the existence of "pulling the whole body together". Any development is the smartest businessman. No one will buy expensive land but produce cheap real estate. After all, real estate is not a public good. Therefore, soaring land prices will inevitably lead to the rise of housing prices, but it is only a matter of time. For investors, when land prices rise, they will take the lead in locking in future price increases, in order to get the first chance of real estate investment faster.

''Cambodia's

apartments are rising every year. I've been to Phnom Penh, and now is a good time to get started."

With 21 Chinese in Cambodia, investment should follow the trend.

Cambodia is not only a popular destination for Chinese investors in recent two years, but also a popular choice for many domestic workers and migrants. According to official data released by Cambodia, there are more than 210,000 Chinese living in Cambodia, compared with nearly 100,000 by the end of 2017.

Why do more and more people choose to work and live in Cambodia? Cambodia itself is a very tolerant Buddhist country with a blend of cultures and comfortable environment, which attracts many foreigners to live here. Phnom Penh, the capital, is home to hundreds of thousands of foreigners all the year round, including residents of Thailand, Malaysia and other Southeast Asian neighbouring countries, as well as a large number of Chinese, Americans and Europeans. At the same time, with the upsurge of Chinese investment, the popularity of Chinese in Cambodia has also made life and investment in Cambodia more convenient.

From the investment point of view, with the boom of real estate investment in Cambodia, it has become a hot topic in the investment circle. The Chinese people always talk about "following the trend" when they do anything. Of course, it does not mean blind pursuit. After all, every investor is an individual with independent thinking ability. But for those who pursue steady investment, they have more pioneers and investment heart. In principle, there will be more protection, "sense of substitution" in the investment circle, but also important.

“My friends have invested in Cambodia ,and if I don't invest in Cambodia,I will have no common language.”

Nearly nowhere to escape CRS，seeking refuge in Cambodia.

Some time ago, China formally began to join the ranks of CRS information exchange. CRS, the automatic exchange standard of tax-related information in financial accounts, mainly exchanges all financial account information of taxpayers abroad, such as stocks, funds, futures, bonds, insurance, equity, etc. Up to now, more than 100 countries have joined the ranks of CRS information exchange, including Switzerland, which used to be a "tax haven".

This means that many high net worth people have the need to avoid tax overseas, and Cambodia is currently one of the few countries that do not join the CRS. It can be expected that in the next few years, a large number of assets from Hong Kong and mainland China will flood into Cambodia market to help asset holders achieve tax planning purposes.

Not only that, Cambodia joined the WTO in 2004, and the government began to implement an open free market economy, pursue economic privatization and trade liberalization, improve the efficiency of government work, and improve the investment environment. At present, it has achieved some results, and its non-CRS membership has really become a haven for investors'assets.

Do you have your own judgment on whether Cambodian real estate investment is a " trap" or a "pie"?