1. Preference — small price tag, to reduce my exposure, commitment, and outbound cash flow.
   1. Preference — slightly bigger exposure than the current unit, since I am optimistic about Phnom Penh
2. Preference — lower psf price, i.e. buying cheap. This translates to lower risk, higher profit margin, higher flexibility (for sale, rent or mortgage).
3. Preference — diversify rather than buying multiple units in the same building.
4. Preference — shops rather than office or home. Shops are precious, unlikely to suffer from over-supply. Likely to generate higher rental yield (no direct benefit over 10Y) giving it higher valuation than non-shops. However, the shop units available are expensive by psf or by price tag, so I may have to let go.
5. Preference — guaranteed rental. I can hopefully forget about the whole thing for 10Y, if I require no mortgage. Perhaps I need to seriously reconsider this preference.
6. Preference — avoid mortgage with high interest and all the overheads. May need to be flexible with this preference.
7. Preference (minor) — water point. Possibly faster capital appreciation.
8. Preference (minor) — avoid changing SGD to USD despite my surplus SGD now, because USD is expensive at present.
9. Preference (minor) — lower floor but Floor 3 vs 4 makes little difference.

There’s a 90% chance I would start earning USD salary in early 2017. Hopefully I could save up enough to pay at TOP time.

• Choice —  Add an 14.99 unit, and hope to sell one of the two before TOP.
  • Need to plan for Scenario B:  unable to sell at a profit. A 140k new commitment would be too heavy and basically beyond my means. So my conservative answer is No. Or take mortgage.
• Choice — The transfer unit is only slightly less heavy and comes with no discount, so my answer is a bigger NONO. Also the original price of $105,730 ($9800/sqm) was already overpriced relative to my unit.
• Choice — Upgrade (i.e. sell #3-163 buy a 14.99 sqm) is a new proposition under consideration, but I lose the water point advantage. Who knows my water point unit might exceed the 14.99 sqm unit valuation in x years and I might regret. More importantly, my #3-163 unit was bought at a lower psf price of $8k/sqm, compared to $9380/sqm for the 14.99 sqm unit, so I feel it’s questionable to sell it at this early stage to buy a more expensive unit. I’d like to see some trend in appreciation (if any) before I decide.

Hi Susan, Some observations to share.

Mr Sok Ly is Cambodian Chinese ( one of 3 I met ), very experienced and willing to share. He shared his own experience in and observations on Phnom Penh property market. Completely Changed my view of Cambodia economy.

Good — I was lucky to get everything done at this Maybank branch, including Internet banking set-up and debit/atm card. I had to use SMS sent to my wife’s Singapore number. I tested Internet banking and debit/atm card. Maybank is expanding fast in Cambodia, showing confidence in the country. There are many other banks on the streets of Phnom Penh. I tend to believe banks generally choose safe and stable locations to open a branch.

Good — I heard that in the neighbourhood of The Bridge, studio rental yield could be up to 10% without considering taxes, repairs, commissions, vacant periods. A 20 sqm furnished studio apartment could fetch USD 500/month according to hearsay. In contrast my hotel charges USD 40/day ($32 for members) and Naga world is at least double that.

Good — many high rise buildings under construction, usually amid low rise buildings. I saw 10 of these at least. Clearly more activity than in Singapore or Manila but much less than the Fort area of Manila I invested in. The Fort is 5 to 20 years ahead of Phnom Penh BKK1. If I worry about The Fort or Singapore overpriced, then the same risk in Phnom Penh is possibly lower.

Good — many locals can speak good English. Some also speak Mandarin.  I feel the education system is producing a decent workforce.

Good — lots of foreign investment in the form of foreign banks, hotel chains, foreign brands. Many retail shops (perhaps 2% of all shops I saw) bearing a completely Chinese shop name. There are also big China companies esp. construction firms. Even more shops sport English shop names. I guess many foreign players are keen about Cambodia. Clearly the economy is opening up.

Basically there are 2 categories of foreigners — Chinese and Caucasian. There are restaurants, shops, residences, schools targeting these 2 groups. Many locals study English and Chinese at school. All professionals can speak English, otherwise they won’t be employed. Clearly the service/retail sector is opening up.

Good — most price tags seem to be available in USD. Every shop would accept USD payment. So our investment will preserve its value in USD, not subject to the weaker local currency risk. http://www.khmertimeskh.com/news/14511/strong-dollar-not-helpful-for-cambodia/ says dollar dominates the local currency in Cambodia.

Bad — traffic jam 4.30pm to 6pm on many segments of my journeys between hotel and airport. Took about an hour if on tuktuk.
(Tip — Avoid using cars. Tuktuk is more manoeuvrable due to smaller size. In a traffic jam that means a lot of time saved.)

Bad and Good — filthy streets in many central and popular parts of Phnom Penh. Most streets are too narrow to cope with current volume of traffic. In overcrowded Phnom Penh, think there is immense room for street infrastructure improvement, and upward potential in real estate valuation.

Good — Mobile network is reliable and very economical. I paid $2 for 1.4GB and some voice airtime. Cellcard is the brand.

Good — Water and electricity supplies are stable without blackout. I boiled the water and drank.

Good — Airport is clean and not overcrowded. Much better than Manila airport.

Good — Located next to the Bridge site, Toyoko Inn is very clean, quiet, with good service all by locals. Very positive impression. I liked the simple healthy breakfast too.

I always need to worry about legal environment, things like stability of regulations on foreign investors and real estate investment, protection of foreign investors and how to enforce basic contract terms. In some markets people delay payment indefinitely and tenants refuse to move out. Some even occupy a unit by force and take it over as his own property, or (more commonly) force owner to accept unfairly low prices. While Singapore has a strong and reliable legal environment, I feel Phnom Penh is not an anarchic market otherwise banks, hotels and shopping malls would be hard to operate, and few buyers would pay such high prices to buy a property. As the legal framework becomes more effective, market becomes more transparent, investor confidence grows, legal risks declines, valuation would start doubling every 5 years.