Cambodia braces for condo glut

Cambodia’s condominium segment is setting itself up for oversupply this year, according to CBRE research via The Phnom Penh Post.

A total of 43 condominium projects, representing around 16,939 units, are set for completion this year, up sharply from 2018 when only 20 condo projects equivalent to more than 5,000 units came online, the consultancy predicted.

The supply of condo units in the kingdom could rise sharply in 2019 partly as a result of the resumption of projects that were suspended in 2018.

Prices of mid-range and high-end condos will fall, relative to the influx of supply, by around four percent and three percent, respectively, the Post reported earlier this year.

Mid-range condos will comprise 43 percent of new condo supply by the end of 2019, while luxury condos and affordable units are poised to take up a 23 percent and 34 percent share in the pipeline, respectively.

“Due to the limited number of affordable condos and Cambodians’ lifestyles in terms of living in condos has begun to change, I think that the low-end condo market should be further developed,” CBRE Cambodia director Ann Sothida told the Post in an interview. “Investment in low-end condos will be easier to sell than in medium and luxury condos.

“Condominium developers should focus on locals,” she added, emphasising that units have a growing market in property seekers who prefer to avoid the increasingly congested traffic in Phnom Penh.