Rents slump by up to 30 percent

via CAAI

Thursday, 04 November 2010 15:00 Soeun Say

PRICES for Phnom Penh’s apartments have fallen as much as 30 percent in the third quarter compared to the first quarter of the year, but insiders say the drop has come at the cheaper end of the residential property spectrum.

More new apartments were being put on the market than present demand warranted, according to Keuk Narin, secretary of the National Valuers Association of Cambodia.

“Based on our research, we estimate rental prices for apartments will continue to drop,” he said. “The supply of apartments for rent is going up, but demand is down.”

Prices would likely continue to drop in the fourth quarter, said Keuk Narin, who is also general manager of Bonna Realty Group.

The cost of renting has been steadily on the decline since mid-2008, according to NVAC statistics.

The average three-bedroom top quality “class A” apartment costs between US$2,200 and $2,650 per month in the latest quarter, a drop from $2,500 to $2,800 per month at the beginning of the year.

Mam Sovandara, property manager of Cambodia Property Ltd Co, said yesterday that prices had fallen slightly in the latest quarter.

Managing some 70 apartments and 500 villas in high-end locations around Phnom Penh, he said demand was primarily being driven by foreigners from Asia and Europe.

The firm now asked between $1,500 and $4,500 per class A unit, $700 and $1,500 per class B unit, and from $200 to $500 per class C, he said.