What Types of Real Estate Can You Buy in Cambodia?Risks, Taxes, and Step-by-Step Purchase Flow Explained

2025.12.24

Author: Anna Araki / Anna Advisors Inc.

In recent years, Cambodia has been attracting growing attention in the overseas real estate investment market.

Due to the long-lasting civil war, Cambodia’s economic growth was delayed for many years. However, the 2022 real GDP growth rate reached 5.3%, a very high level, and the country is expected to continue developing further.

In this article, we’ll explain in detail:

・And the typical purchase flow

・The current state of the Cambodian real estate market

・The types of properties foreigners can purchase

・The merits and risks of buying

・The taxes involved

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Movements in the Cambodian Real Estate Market

First, let’s look at the current condition of the Cambodian real estate market.

How Much Does Cambodian Real Estate Cost?

Overall, Cambodian property prices are significantly lower than those in Japan or other Southeast Asian countries.

For example, a luxury condominium that might cost several hundred million yen in Japan can sometimes be purchased in Cambodia for around 20 million yen (roughly high five figures in USD), depending on the property.

Price Trends in the Real Estate Market

If we look at land prices in the capital, Phnom Penh, you’ll see that in many areas, land values have more than doubled compared with 2010.

Several factors contributed to this:

Since 2011, foreigners have been allowed to purchase investment properties in Cambodia, which led to a flow of overseas capital into Phnom Penh.
In addition, a rise in visitor arrivals and an increase in foreign companies entering the market have further supported demand.

As a result, land prices have climbed sharply in many parts of the city.

Merits of Buying Real Estate in Cambodia

So, what are the advantages of buying property in Cambodia?
Here we’ll look at four key benefits.

1. Property prices are relatively low

Compared with many other Asian countries, Cambodian real estate is still relatively inexpensive, which keeps purchase costs down.

Even high-end condominiums in central Phnom Penh can sometimes be purchased from around 20 million yen(approximate).

Moreover, these properties are typically rented out to expatriates and other high-income tenants, so they can often be operated with relatively high rents and robust yields.

If you were to purchase a similar standard of property in:

Singapore or Hong Kong, prices would likely exceed 100 million yen, and
Even in Kuala Lumpur, Malaysia, another developing market, a comparable condo could cost around 35 million yen.

From this perspective, Cambodia still offers entry at a lower price point.

2. High growth potential and expectation of future price increases

In recent years, the Cambodian economy has grown rapidly, and future appreciation of real estate values is widely expected.

As noted, the 2022 real GDP growth rate was 5.3%, and with continued population growth and inflows of foreign capital, further development is anticipated.

Because much of the foreign capital flowing into Cambodia is directed toward real estate investment, this sector, in particular, is viewed as having strong growth potential.

For that reason, Cambodian properties are considered highly attractive investment assets for those aiming for capital gains (profits upon sale).

3. You can hold assets in US dollars

Another key advantage is that real estate investment in Cambodia can be conducted in US dollars.

Because the national currency, the riel, has relatively low credibility, US dollars are widely used in everyday transactions.

Unlike other Southeast Asian countries, where you must invest in the local currency, Cambodia allows you to invest directly in US dollars, thereby reducing foreign exchange risk.

4. Non-residents can open local bank accounts

In Cambodia, even foreigners who do not reside in the country can open bank accounts with local banks.

By opening US dollar-denominated high-interest fixed deposits, you can efficiently manage the rental income (income gains) generated by your investment properties.

This structure makes it easy to:

And continue dollar-based asset management

Receive rent

Manage expenses

Risks of Buying Real Estate in Cambodia

On the other hand, there are some risks to consider when purchasing property in Cambodia.
Here are four main risk factors, explained one by one.

1. Property types available to foreigners are limited

Foreigners who do not live in Cambodia have access to only certain types of properties for investment.

Foreign buyers are allowed to purchase residential units such as apartments and condominiums that meet conditions like:

Located on the second floor or higher, and
Within 70% or less of the building’s total floor area.

However, non-residents are not allowed to own land or purchase detached houses (villas).

2. Pre-build schemes can be canceled mid-construction

One of the major risks in Cambodian real estate is the possibility that a building may never be completed and never handed over to the buyer.

In Cambodia, new properties are often sold under a pre-build scheme—that is, buyers purchase before construction is completed.

Because payments are made prior to completion, unforeseen troubles—such as a project being halted—can lead to situations where the property is never delivered and the money already paid is not refunded.

3. The land registration system is still underdeveloped

Cambodia’s land and property registration system is still under development, so buyers must proceed carefully.

During the civil war period (from the early 1970s and lasting more than 20 years), many legal records, including those related to property ownership, were destroyed. Cambodia is still in the process of rebuilding its legal framework.

Currently, when acquiring real estate in Cambodia, two types of documents may be issued:

Soft title:
A document that proves a property transaction has taken place.
Hard title:
Essentially equivalent to a title deed in Japan. Without this, it is difficult to legally assert full ownership rights.

For investors, it is generally recommended to secure a hard title when purchasing property in Cambodia.

4. Regulations and legal systems may change going forward

Although Cambodia’s economic growth is remarkable and the country is in the process of becoming a modern state, there are still areas of political and legal instability.

As such, it is quite possible that policies and laws will change in the future.

For example, Cambodia could revise its tax system, making it necessary to pay taxes on real estate investments that were previously untaxed (such as capital gains tax).

Regarding capital gains tax, Japanese residents should also keep in mind that there may be tax obligations in Japan.

Types of Real Estate You Can Buy in Cambodia

Let’s summarize the types of properties that non-resident foreigners can invest in within Cambodia.

Apartments and condominiums

The majority of investment properties in Cambodia are apartment and condominium units.

As long as the units meet conditions such as:

Located on the second floor or higher, and
Fall within 70% or less of the building’s total floor space

they can be purchased by non-residents as sectional (strata-title) units.

Hotels and offices

While residential properties that non-residents can buy are limited to apartments and condominiums, it is also possible to purchase commercial properties such as:

Hotels, and
Office buildings

as investment properties.

Because of the rapid development and rising vacancy risks in residential condos, there is also a growing number of investors who prefer to buy foreign-oriented hotels or office buildings for multinational tenants.

Land purchases are not allowed

Non-resident foreigners are prohibited from purchasing land in Cambodia.

As of 2023, among the major Southeast Asian countries, the only country where non-resident foreigners are allowed to purchase and own land is Malaysia.

Three Types of Taxes When Buying Cambodian Real Estate

Here are the main taxes incurred when buying and owning real estate in Cambodia.

1. Property tax (annual)

For properties valued at 25,000 USD or more, property tax is imposed at a rate of 0.1% on 80% of the appraised value.

2. Withholding tax

For income generated from owning real estate, non-residents are subject to monthly withholding tax at a rate of 14%.

If the owner is resident in Cambodia, the withholding tax rate is 10% per month.

3. Property transfer tax

When purchasing a property, a property transfer tax of 4% is levied on whichever is higher: the appraised value or the purchase price.

In principle, this tax is paid by the buyer, but in some cases—such as resales—it may be borne by the seller, depending on the terms of the transaction.

The Process of Buying Real Estate in Cambodia

In practical terms, purchasing real estate in Cambodia generally follows the steps below:

Choose a brokerage firm
- Contact a company directly
- Or join an online seminar and consult afterward
Select a property
- Gather information from web listings
- If possible, join a local property tour and inspect in person
Decide to purchase the property
- Understand all costs, taxes, and support services
- Review contracts carefully before proceeding
Take delivery of the property
- Select a property management company to handle rental operations and daily management

When buying property overseas, it is strongly recommended to use a real estate company that offers support in Japanese, such as:

Having Japanese staff, or
Providing Japanese-language support throughout the process.

For a Japanese buyer to negotiate and complete a real estate transaction only in Khmer with local parties is extremely challenging.

Also, it is important to confirm whether the company:

Is thoroughly familiar with the local real estate industry, and
Has a strong track record of transactions and management.

Ideally, look for a firm that can handle both:

The purchase and sale of properties, and
The ongoing rental and property management after acquisition.

This offers significantly more peace of mind.

Conclusion

With its promising economic outlook, Cambodian real estate can provide both:

Capital gains (profits on sale), and
Income gains (rental income),

making it a powerful option for medium- to long-term asset building.

However, before purchasing, it is important to carefully review:

Risks,
Tax rules, and
The legal and regulatory framework,

and to fully understand both the advantages and disadvantages.

By choosing reliable partners and preparing well, you can make more informed decisions when considering investing in Cambodian real estate.