Guide to buy property in Cambodia

14 February, 2020

Guide to buy property in Cambodia

1) Planning and Funding
When considering purchasing a property in Cambodia, a buyer’s biggest concerns are:
  • Good location,
  • Property pricing,
  • Supportive infrastructure, 
  • Healthy environment,
  • Legality. 
Generally speaking, however, a property purchase is a large investment. Also, Cambodian people now generally require a loan or mortgage to finance such a purchase.

We will tackle financing in a moment. But first, let's start by considering how much you can afford. To determine a reasonable price, you need to consider the amounts you intend to fund, whether using your existing assets or a loan/mortgage.

When considering how much you can afford, in addition to the price of the property itself, you will need to consider miscellaneous costs such as tittle transfers or registration costs.

2) Choosing Properties
Now that you know how much you can afford, the next step is to gather information on properties that meet your requirements and priorities.
Types of Property: Flat / Villas / Condominium / Single Houses / Land, etc.
Purposes: Private Residence / Investment / Second Home, etc.
Preferred Areas: Convenience to Commute / Living Environment, including Locations of Markets, Hospitals, Schools, etc.

If you'd like to learn more about Phnom Penh, please click an area on the map to show that area's information.
Year of Construction: How old the building is
Parking Space: How many parking lots you need agents offer a great selection of properties with photos and floor plans, mainly in the city center. It also covers many, many more areas throughout Cambodia. agents make it simple to search for properties that suit your needs and wants. Properties Search. 
Once you find properties that interest you, please contact listing agents and they will get back to you by phone or e-mail with specific details and availability. AND if you wish to visit the property, no problem! They will arrange everything for you and accompany you on your visit.

3. Property Visits
Once you find properties that interest you, visiting them is the next extremely important step. The listing agents will be available to schedule visits for you and then pick you up at a convenient meeting point to show you the property.

Basically, if the property is vacant, the bi-lingual agent can arrange a visit at almost any convenient time for you. If, however, the property is still occupied, we will generally need a working day or two, prior to your desired visit date to schedule a visit with the seller.

4. Application
After you have decided on a property, you need to submit a "purchase application form". Completing the "purchase application form" notifies the seller of your intention to purchase the property through the listing agent. This is important for the Seller to know that the listing agent can work on your behalf.

The purchase application form includes:
  • Your offer price,
  • Payment method,
  • Contract date, 
  • Delivery date,
  • Others (upon request)
The listing agent will help you negotiate all the details (including the final price) with the Seller.
Once you and the seller have agreed on the major conditions, a sales contract can be prepared.

5. Contract Signing
Prior to signing a contract, the listing agent and lawyer will review all the content with you. The listing agent and lawyer will help you to review certain contractual issues with the Buyer and Seller at the time of purchase. Such issues include an overview of the property as of the contract date, the agreed-upon payment method, compensation for contract violations and the owner's rights.

After the required explanations, the Buyer and Seller will acknowledge their agreement and will sign and seal the contract. Upon signing the agreement, the Buyer shall make a partial deposit. The amount deposited at this time will be deducted from the agreed-upon final sales price.

Costs involved in purchasing a property 
Transaction costs (legal fees and agent’s commission) can be different from the deal to deal:

  • Cadastral Office “Service Fee”                    US$1000 – US$1500                   Buyer
  • Tittle Certificate                                           US$10 – US$20                           Buyer
  • Legal Fees               US$200 – US$500                  Buyer/Seller
  • Agent’s Commission              2% - 3%                          Seller
  • Transfer Tax              4% (officially)                          Seller
  • Cadastral Transfer Fee                     350,000R                           Seller
  • Stamp Duty             5000R                           Selle
6. Housing Loan Application
In the event that you intend to fund your purchase with a loan/mortgage, you need to apply to an appropriate financial institution, right after signing the property sales and purchase agreement.

Each financial institution applies its own specific loan approval process and requirements and these can get complicated quickly. The listing agent can assist you by introducing suitable mortgage lenders and lending plans to you and by helping you through all the steps with each potential lender. Each financial institution will require that you complete, sign, seal and deliver their specific loan application form. 

Financial institutions normally take between 2 and 3 weeks to process a loan application. Once approved, you will need to sign a loan agreement to finalize conditions to borrow money.

In some cases, the property sales and purchase agreement have a special clause with respect to the loan/mortgage.

Since it is very common for potential Buyers to sign the property sales and purchase agreement BEFORE obtaining official approval from a financial institution for a loan, a special clause is necessary. The clause allows for, "canceling the agreement in the event that the Buyer fails to obtain a housing loan". If a potential Buyer does have to cancel this, they need to notify the Seller through an agent. In this case, the property sales and purchase agreement usually stipulate that the whole deposit shall be paid to the Seller.

In the event that an "Interim Deposit or Booking Payment” is requested by the Seller in the property sales and purchase agreement, the Buyer will pay the interim deposit to the Seller by the due date specified on the contract. *The Seller shall make a booking agreement for the Buyer. The amount paid as an interim deposit is accepted by the Seller and applied to the total sales price. At the closing, the Buyer must pay the remaining amount. The total sales price, minus the amount paid as a deposit.

Costs involved in purchasing a property 
  • Bank charge                      0.5% to 1% of total amount of loans
  • Tittle burden in the Khan “District”               US$250 to US$500
  • Lawyer fee                      US$200 to US$500 
  • Property valuation                      US$180 to US$500
  • Fire insurance              Depend on the size and condition of the building
7. Closing and Transfer
Once a housing loan is approved, the Buyer pays the remaining sum of the sales price to the Seller and the property is transferred to the Buyer. The agent will arrange the time and place for the closing. If the Buyer is using a housing loan, it is quite common to hold the closing at the bank which offered the mortgage.

The Buyer pays the remaining sum and other expenses, and then receives the keys and necessary documents for the property. Normally, a Legal Scrivener (arranged by the agent for the deal) processes the title transfer to the Buyer and necessary related registration documents).

The Seller and the Buyer sign and seal the registration application forms.
In addition to registration fees, the Buyer pays a commission to the Legal Scrivener.
* It normally takes between 4 and 6 weeks after applying for the title transfer for a title certificate to be issued.

Please make sure to prepare all the necessary documents in advance.
  • Original copy of identification card (Passport for foreigner) with an officially registered seal
  • Original copy of the family book
  • Original copy of marriage certificate, if married, or letter of clarification of single status, if not married 
  • Original copy of a birth certificate 
The Buyer needs to prepare the remaining sum and other fees.
  • Agent's commission
  • Lawyer fee
  • Management fee (for condominium or Borey).
  • Other membership fees 
Then, the property is delivered to the Buyer. And a final check of the present condition of the property is conducted in the presence of both the Seller and Buyer. 

Moving in
At the Buyer's request, the agent assists the Buyer to move in by arranging for utility setup services and handling all necessary notifications. agents and bilingual coordinators remain at your disposal, to help you find and purchase the "right" property. And they continue to support you long after your purchase is completed.

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