The property investment market in Cambodia during the COVID-19 epidemic
The outbreak of Novel Coronavirus pneumonia (COVID-19) was in December 2019. Apart from the high infections and deaths, COVID-19 is also hurting major economies and affecting the progress of all countries.
The situation in Cambodia is milder than in other ASEAN countries or developed countries. However, the kingdom has suffered significantly from its high dependence on investment and tourism from other countries due to the limitation of global traveling. Furthermore, The "February 20 Community Outbreak" that happened this year also caused Cambodia to suffer for the first time after one year of the global outbreak. Infections have risen from 500 to more than 80,000, with 1,600 deaths(2021/8/10). The government has no choice but to restrict traveling across provinces, impose a curfew, lockdown, and other emergency measures to prevent the further spreading of the virus.
In addition to the impact on conventional industries, real estate investment, and other related industries have also experienced chaos due to the epidemic's effects, resulting in sluggish purchasing and lack of transactions. According to the research of CBRE Cambodia, Cambodia's real estate industry performed strongly in early 2021, and almost all indicators increased significantly than last year. But the recent outbreak still brought vast uncertainty to the market, causing the price of different real estate to drop by 30% to 50% compared to the beginning of the year. The phenomenon indicates that the Cambodian real estate industry will have to go through a difficult period in the future.
Short-term price fluctuation is one of the main reasons investors' indecision on property investment. However, there are still many critical factors for investors to consider whether to own a property or not. For example, the Asian Development Bank (ADB) and the International Monetary Fund (IMF) had announced Cambodia's projected economic growth rate in 2021 are 5.9% and 6.8% early this year. It was still an optimistic prediction compared to the number before the epidemic. Other key factors such as political stability, growing human resources, and the usage of U.S. dollars are also important factors for investors to consider in the decision-making process of property investment to build the best portfolio for themselves.