Hard Title vs Soft Title in Cambodia : What's different you ought to know about?

As an investment foreigner in Cambodia, you should know that in Cambodia only the Cambodian nationals are able to own land and property within the Kingdom. Normally we have "Strata Title" ownership when we buy a condominium. However, even if the numbers are increasing, Strata title property is less popular in Cambodia.

Two more key proprietary forms, called "Soft Title" and "Hard Title" exist in Cambodia. Legally, the two of them can grant you free ownership, but either a Cambodian or a Cambodian firm must own the property. You need to know about these two titles before signing the contract, there are a few key elements.

#Soft Title

Soft title is the most frequently issued Cambodian land title and the most popular form of ownership, since the transfer taxes and fees are considerably cheaper than hard ones. Soft titles at the local or district level are recorded and are not nationally recognized.

The processing time is therefore faster and easier. The consent can be gained within a few days instead of months (estimated at 7-10 working days). More than 80% of Cambodia's land holdings under the soft title are owned. 

All lands awarded under this title shall be acknowledged lawfully by the local authorities (Sangkats & Khans). For Cambodians, a legitimate legal ownership document is deemed to be a guarantee for almost every local bank, in order to receive a loan. It is a guarantee.

#Hard Title

On the other hand, the hardest title, registered by the national government as land ownership, represents Cambodia's main type of ownership of property. The Ministry of State of Cambodia is well known and hence gives property owners an unquestionable right. 

The hard title owner normally wins the action in case of disagreements. Hard securities are therefore said to be more secure and more secure for international investors, in particular. The move normally takes months to obtain approval (12 weeks). A transfer tax of 4 percent is paid based on the total value of the property, which in comparison with soft titles is more expensive. 

Therefore, it is essential that you have full ownership before you buy a house to be sure of your new asset. You should check the status of your title with your developer, realtor or lawyer. 

If the property is a soft title, confirm with the seller whether they are the genuine owner and do not have burdens on land. I believe that it is time that the government initiatives turned all lands in Cambodia from a soft title to a hard title.

Source : Compass Original