‘construction and Real Estate Sector Will Not Fall in 2019’

• 5 January 2019
• Local News
• 3789 Views

With Cambodia’s economic growth partly dependent on the construction and real estate sector, predictions remain healthy for 2019, despite a decline in capital investment in 2018.

The recent macroeconomic report from the National Bank of Cambodia (NBC) outlined some of the risk factors for Cambodia’s economy, including stronger reliance on construction and real estate as the sectors contribute one-fifth of the growth.The NBC also highlighted that the construction sector generally has a development cycle, which can increase and slow down when large construction projects are completed.

In 2019 however, the construction and real estate sector will remain healthy even though the growth rate is lower than last year, according to Mr Chrek Soknim President of the Cambodian Valuers and Estate Agents Association (CVEA).

“Normally if I look at the construction sector in Cambodia, it does not have any problems, and for 2019 it will continue to grow. It will not be as high as in other years, but it will not fall,” he said.

“Overall, we see that it will grow between 10-15%, but some areas may vary, like from Phnom Penh to Sihanoukville,” he added.

Meanwhile, a number of real estate experts in Cambodia also told The Phnom Penh Post recently that the sector is still healthy and with the presence of Chinese investors it will help boost the property sector in 2019.

With the booming construction and real estate sector, the NBC also highlighted that rapid growth can make prices of real estate increase beyond actual demand which can pose risk for banks and lose trust from investors.

“We see that today the construction sector is receiving support, and through our study, some people still do not have houses, so there is a lack of houses in Phnom Penh….if we build houses for sale it will be fast,” said Mr Soknim.

However, related to the prices of the property, Mr Soknim stressed that it is a competition in which a well-designed project is easier to sell compared to those with a less attractive design.

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