Learn how to secure a home loan in Cambodia as a foreigner. Our comprehensive guide walks you through the legal framework, obtaining a Strata Title, finding a property, and more.
As a foreigner, investing in real estate in Cambodia can be a rewarding venture. The country’s real estate market has been on a steady rise, with a 3.7% increase in property prices in 2020. The Cambodian government has also been encouraging foreign investment, with foreign direct investment inflows reaching $3.58 billion in 2022, according to the World Bank. This guide will walk you through the process of securing a home loan in Cambodia as a foreigner.
Step 1: Understand the Legal Framework for Foreign Property Ownership in Cambodia
Foreigners are allowed to own properties in Cambodia but with some restrictions. According to the 2010 Law on Providing Foreigners with Ownership Rights in Private Units of Co-Owned Buildings, foreigners can own private units above the ground floor. However, the total surface area of all private units owned by foreigners must not exceed 70% of the total surface area of all private units in a co-owned building. Understanding this legal framework is immediate, as it involves learning about the laws and regulations related to foreign property ownership in Cambodia.
Step 2: Obtain a Strata Title in Cambodia
A Strata Title is a type of ownership for multi-level apartment blocks and horizontal subdivisions with shared areas. This title gives foreigners the right to own private units in co-owned buildings. The Strata Title is registered with the Ministry of Land Management, Urban Planning, and Construction, and it’s crucial for foreigners intending to own property in Cambodia. The duration of this step can vary greatly depending on the property and the speed of the legal process. It could take anywhere from a few weeks to several months. Of course, Pointer can help you take care of this.
Step 3: Find a Suitable Property in Cambodia
Pointer has a wide range of properties that foreigners can invest in. Some of our exclusive projects, such as Samraong Village, Bakong Village, Rose Apple Square, La Palm Residence, and PH The Star Polaris 23, have partnerships with banks in the country, making the loan application process easier. The time it takes to find a suitable property can vary widely depending on the individual’s preferences, market conditions, and the availability of properties that meet the individual’s criteria.
Borey Palm Springs, near Aeon 3: Starting at $140,000
Bakong Village, Siem Reap: Starting at $70,000
Rose Apple Square, Siem Reap: Starting at $70,000
Samraong Village, in Prek Pnov: Starting at $70,000
The Star Polaris 23 Condominiums, Chba Ampov: For rent and sale, starting at $48,000
Step 4: Apply for a Home Loan in Cambodia
Once you’ve found a suitable property, the next step is to apply for a home loan. Several banks in Cambodia offer home loans to foreigners, including Canadia Bank, ABA Bank, Maybank, etc. The loan terms and interest rates vary, so it’s advisable to shop around for the best deal. The application process itself can take a few days to a week, depending on the bank. However, the approval process can take anywhere from a few weeks to a couple of months, depending on the bank’s procedures and the completeness and accuracy of the provided documents.
Step 5: Prepare the Necessary Documents for Your Home Loan Application
To apply for a home loan, you’ll need to provide several documents, including a copy of your passport, proof of income, and a sales and purchase agreement from the developer or seller. Some banks may require additional documents, so it’s important to check with the bank beforehand. This step can take a few days to a week, depending on how quickly the individual can gather all the necessary documents.
Step 6: Property Valuation in Cambodia
The bank will conduct a property valuation to determine the market value of the property. This is to ensure that the loan amount does not exceed the value of the property. This process can take anywhere from a few days to a couple of weeks, depending on the bank and the property. As a one-stop shop for all things real estate, Pointer has our own licensed valuation team who will conduct our own valuation of the property for you as well.
Step 7: Loan Approval and Disbursement in Cambodia
Once your loan application is approved, the bank will disburse the loan amount to the developer or seller. The disbursement process may take a few weeks, so it’s important to factor this into your planning.
Step 8: Register the Property in Cambodia
After the loan is disbursed, the next step is to register the property with the Ministry of Land Management, Urban Planning, and Construction. This process involves paying a registration fee and stamp duty. The property registration process can take a few weeks to a few months, depending on the speed of the government processes.
Investing in real estate in Cambodia offers a wealth of opportunities for foreigners. With a growing economy and a welcoming environment for foreign investment, now is a great time to consider investing in Cambodia’s real estate market. Should you consider investing in Cambodian real estate, make sure to look no further than Pointer for professional, reliable, trusted, and secure property transactions.
For more information or to start your property investment journey in Cambodia, don’t hesitate to contact Pointer today. Our team of experienced professionals is ready to assist you every step of the way.
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