Basic Rules and Purchase Process

Understand Ownership Laws

Foreigners:

Can only own properties above the ground floor (e.g., condominiums) and cannot own land directly. However, they can:

Lease land for up to 50 years.

Own land indirectly through a Cambodian nominee or a Cambodian company (with legal risks).

Cambodian Nationals:
Have the right to own land and property freely.

Types of Title Deeds

Hard Title: Official, registered ownership recognized nationwide.

Soft Title: Recognized at the local level but less secure than a hard title.

Strata Title: Specific to condominiums and available to foreigners.

For foreigners, we advise purchasing properties with a hard title or strata title, as they offer greater security and lower risk.

Taxes and Fees

Transfer Tax: 4% of the property value.

Additional Fees: May include legal fees, notary fees, and administrative charges.

Lease Options for Foreigners

Long-term leases (up to 50 years) are an alternative for foreigners who cannot directly own land.

Tips for Foreign Buyers

Ownership Restrictions: Foreigners cannot own land but can own strata-titled properties (condominiums) or lease land for up to 50 years.

Nominee Structure: Some foreigners use a Cambodian nominee to hold land, but this carries legal risks.

Verify Developer Credentials: When purchasing in new developments, research the developer's track record and ensure compliance with local laws.

Purchase Process

1. Property Search and Verification

Define Your Requirements

Budget

Purpose: Investment or personal use

The area to be purchased should be clearly defined depending on whether it is for investment or personal use.

Key Locations in Phnom Penh:
A. BKK1 (Boeng Keng Kang 1): Upscale and expatriate-friendly.
B. Toul Kork: Residential and quieter.
C. Russian Market (Toul Tom Poung): Affordable and vibrant.
D. Daun Penh: Central, near cultural and historical landmarks.

2.Conduct Due Diligence to ensure:

The seller has proper ownership documentation (hard title or soft title).

The property is free of disputes, mortgages, or encumbrances.

3. Negotiate Terms

Agree on the property price and other terms (e.g., payment schedule, transfer fees, etc.).

A deposit (usually 10% of the property price) may be required to secure the property.

Sometimes, the seller requires a small booking fee before the 10% deposit to ensure that both the buyer and seller do not change their minds and to reserve the property from being sold to a third party.

4. Engage Legal Assistance

Hire a lawyer to draft and review agreements, verify documents, and guide you through the legal process.

Check the title deed at the Ministry of Land Management, Urban Planning, and Construction (MLMUPC) or the local Sangkat (commune) office.

5. Sales Agreement

Draft a Sales and Purchase Agreement (SPA) that outlines:

Parties involved.

Property details.

Purchase price and payment terms.

Conditions for the transfer of ownership.

Both parties sign the SPA in the presence of a lawyer or notary.

6. Transfer of Ownership

Visit the local land office or MLMUPC for the official ownership transfer.

Submit the required documents:

Title deed

SPA (Sales and Purchase Agreement)

Identification documents of both parties (ID card or passport)

7. Registration and Completion

Once taxes are paid and the transaction is approved, the new owner is issued an updated title deed.

The property is now officially under the buyer’s ownership.

8. Handover

Once the title transfer is complete and full payment is made, the buyer takes possession of the property.

9. Post-Purchase

Utility Transfer: The buyer transfers utilities such as electricity, water, and internet into their name.

Property Registration: The buyer ensures the property is fully registered under their name at MLMUPC.

Verification: The QR code on the hard title or strata title can be scanned to confirm ownership.