Compass Real Estate > Cambodia Real Estate Information > According to Cambodian law, there are these differences between foreigners and natives!

According to Cambodian law, there are these differences between foreigners and natives!

2020-02-20
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Summary:Although the conditions for buying a house for foreigners are loose, like other countries, Cambodia's real estate industry is also subject to relevant laws.

Cambodia's real estate industry is favored by investors all over the world for its freehold property rights, denominated in U.S. dollars, free from foreign exchange controls, and a high return on investment. In recent years, Cambodia's real estate industry has developed rapidly, and the conditions for foreigners to buy a house are relaxed. Cambodia's real estate industry is also subject to relevant laws. Foreigners and natives have different treatments for buying housing.

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1. What legal protection does Cambodia have for foreigners buying a house?

On April 5, 2010, the Cambodian Parliament discussed and passed the Foreign Real Estate Property Law, which was jointly formulated by the Ministry of Land, Urban Planning and Construction and the Ministry of Justice. According to the law, foreigners will have the right to buy housing in Cambodia and pbtain legal property rights.

2. What regulations does Cambodia have for foreigners to purchase housing in Cambodia?

On December 4, 2010, the Cabinet of Ministers of Cambodia passed the draft Law on Ownership of Private Houses for Foreigners, which allows foreigners to purchase real estate on the second floor (excluding ground floor) of apartments in Cambodia and own 100% ownership (excluding land ownership).

3. Is the property ownership certificate obtained by a foreigner the same as a Cambodian citizen?

Foreigners who buy houses above the second floor of high-rise buildings in Cambodia can obtain the same property ownership certificates as Cambodian citizens, and can rent and sell housing freely.

4. Can foreigners buy land in Cambodia?

According to the Constitution of Cambodia, natural or legal persons of Cambodian origin can individually or collectively own land ownership. A Cambodian legal person is a company in which a Cambodian citizen or company holds 51% or more of the shares.In other words, foreigners cannot buy land on their own, they must buy it in the name of a company. A registered company cannot be wholly-owned. It must be a Cambodian with a 51% share and a foreigner with a 49% share.

5. Can foreigners buy villas in Cambodia? Are there any local requirements for villa construction in Cambodia?

It is impossible because Cambodian law stipulates that foreigners cannot purchase land and villas in their personal names. The Cambodian government stipulates that villas can only be built on two floors above ground and one or two floors underground, and the third floor cannot be build, only one floor villa is not allowed.

6. Does the Cambodian government have any restrictions on the area towards foreigners?

Foreigners cannot own property in the private portion of a multi-owner house within 30 kilometers of the land boundary, unless the multi-owner house is located in a special economic zone, an area where important residents are concentrated, and an area prescribed by the Royal Government of Cambodia. The project is 30 kilometers away from the land boundary and does not belong to the Cambodian government's restricted house purchase area.

7. How long is the life span of property rights in Cambodia? And is there a time limit on the property rights of foreigners?

There are two types of property rights in Cambodia: freehold property rights and fixed-term property rights. For freehold, the homeowner can own the property right permanently. For limited-term property rights, the homeowner can only own 99 years of ownership, but can renew the contract after 99 years. In addition, there are no restrictions on foreigners' ownership of real estate. Permanent property rights are hard title and limited-term property rights are soft title.

8. Is there a difference between taxes and fees for foreigners and natives buying housing in Cambodia? What taxes are involved in the process? When to pay it? And how much?

Foreigners buying housings have the same taxes and fees as natives, same freehold property rights and foreigners enjoy the same taxes. If the property right with hard title, the buyer must pay a 4% real estate transaction tax on the selling price and a fee of changing the owner's name of $ 1,000 to $ 3,000. If the property right with soft title, the buyer only needs to go through the formalities with the community authority, and the fee is about US $ 200 to US $ 800.

9. Do foreigners need to pay taxes on rents in Cambodia?

Foreign owners only need to pay a 10% rent income tax, but they need to have a fixed residence in Cambodia or stay in Cambodia for more than 182 days. A foreign owner who does not have a permanent residence or stays in Cambodia for less than 182 days must pay a 14% rental income tax.

10. Do I need to pay gift tax and inheritance tax if i gift housing in Cambodia?

Cambodian law levies a 4% gift tax on real estate but does not levy inheritance tax.

11. What is process for foreigner if they are going to buy housing in Cambodia ?

Take fingerprints→Write a power of attorney (entrust the company to rent or sell on behalf)→Bank account opening (including online account opening) (money must be exported from the bank in Phnom Penh, and the local bank network must be authorized to sign)→Pay the house payment in full→6 months management fee and basic utility fee are paid in advance→ The management fee and utility fee are paid by the tenant after renting the house→Execution of household conventions and property management requirements→After completing the house payment procedures, you can prepare documents, pay taxes and agency fees, apply for a hard card, and register ownership procedures.

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