Cambodia’s real estate market has seen a significant transformation since the introduction of Strata Titles in 2009. These titles have opened doors for foreign investors and expatriates, providing a way to own property in a rapidly developing economy. Here’s what you need to know about Strata Titles and how they can be your gateway to investing in Cambodia’s burgeoning property sector.
What is a Strata Title?
A Strata Title is a form of property ownership recognized by the Ministry of Land Management, Urban Planning, and Construction in Cambodia. It is a form of hard title that applies to individual units in co-owned buildings, such as condominiums, and is available to foreign nationals.
It allows the holder to own a specific unit within a condominium or complex, while also sharing ownership of common areas such as lobbies, pools, and gyms. Think of it as a deed for your condo, granting exclusive ownership of the interior walls, fixtures, and a proportional share of common areas like hallways, lobbies, and amenities.
- Full Ownership: Strata Titles grant foreigners the right to fully own their condo units.
- Shared Common Areas: Owners share the maintenance and enjoyment of common facilities (pools, gyms etc.)
- Land Ownership: As direct land ownership is not permitted for foreigners Strata Titles offer a viable alternative.
Main conditions
- Strata Titles apply to buildings constructed from 2010 onwards
- Foreigners can own up to 70% of the total floor area above the ground floor within a condominium.
- Units on the ground floor are not eligible for foreign ownership under Strata Titles.
- Properties within 30km of national borders are also excluded from foreign ownership.
- Prospective buyers must provide certified and Khmer-translated documents regarding their marital status and identity (Passport Translation).
- The Strata Title itself is issued solely in Khmer, necessitating all foreign buyers to have their names translated accordingly.
- Transfer tax of 4% of the property’s appraised value is required payable to General Department of Taxation. This is usually paid by Buyer but if the parties agree otherwise it may be covered by Seller also.
Other considerations
- It’s crucial to verify the legitimacy of the land developer’s Hard Title with the Ministry to ensure that it’s eligible for division into Strata Titles. The Ministry of Land Management is the sole authority for Strata Title registration. Verify the developer’s master title (Hard Title) with the Ministry to ensure its legitimacy.
- Buyers must be physically present in Cambodia for fingerprinting and to complete the documentation process, sales agreement, and ownership transfer application.
- Seek guidance from a reputable professional specialising in Cambodian real estate to navigate legalities and potential tax implications.
- Due Diligence is essential. This includes verifying land titles, researching the developer’s reputation, and understanding the management company structure for common area upkeep.
Sample Strata Title
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