Rents in Phnom Penh slumped by 20%

Rents for serviced apartments have consistently dropped since the end of the first quarter this year 

Competition in rental prices will only intensify as the number of apartments and condominiums entering the market increase in 2021. noomcpk/Shutterstock

According to The Phnom Penh Post, rents for serviced apartments in the capital have plunged about 20 percent year-on-year by the end of 2020, due to the drop in the number of overseas workers and investments in the midst of the pandemic.  

CBRE Cambodia stated in a recent real estate study that the average monthly rent for “Grade A” one-bedroom apartments were USD900 to 1,500, while two-bedroom units were USD800 to 2,300 as of the end of last year, down 18.74 percent year-on-year.  

“Grade B” studios and one-bedroom apartments were USD500 to 1,000 per month, while two-bedroom units were USD1,200-1,600, down 18.21 percent year-on-year.  

Kim Kinkesa, CBRE Cambodia senior manager, said that rents for serviced apartments in Phnom Penh have gradually declined since the end of Q1 2021, pinning the situation on foreign residents that have not returned due to travel restrictions.  

“According to research, apartment rental prices in 2021 may decline even further seeing that the number of foreigners travelling to Cambodia will not be as large as before,” said Kinkesa.  

She added that “competition in rental prices will only intensify as the number of apartments and condominiums entering the market increase in 2021.”  

As prices are currently at an all-time low, Kinkesa expressed optimism that the decline rate would ease this year.  

Sam Soknoeun, Global Real Estate Association president, said that Cambodia’s apartment rental market is highly dependent on foreigners, and the pandemic has placed the market in a rut.  

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“Rents and occupancy rate for apartments in Cambodia have been falling since February last year, as scores of foreign consumers have returned to their home countries and the number entering Cambodia during the period is nigh on nil,” said Soknoeun 

Successful control of the outbreak and a pre-pandemic travel environment would induce occupancy rates and rents to strengthen again.  

“I don’t expect the market to be as strong in 2021 as it was before the crisis, it’ll take more time to attract more foreign visitors to Cambodia,” he said.