Cambodia Real Estate Law 2025: An In-Depth Analysis of Tax Incentives, Legal Frameworks, and Investment Strategies

Executive Summary

The year 2025 marks a pivotal moment for Cambodia’s real estate market, defined by the intersection of robust government interventions and a market landscape fraught with challenges yet replete with opportunities. This report provides a comprehensive, multi-faceted analysis of significant legal changes, particularly the new tax incentive package, and evaluates their impact on both domestic and foreign investors.

Key findings of this report include:

1. Tax Policy as a Strategic Intervention Tool: The Cambodian government has launched a series of tax incentives effective in 2025, representing not merely encouragement but a deliberate act to address pressing market issues. These measures include a multi-tiered system of stamp duty exemptions and deductions, targeting both the affordable housing segment and the oversupplied high-end condominium market, along with the continued deferral of capital gains tax for individuals. These policies create a time-limited “window of opportunity” for investors in what is currently a buyer’s market.
2. Maturation of the Ownership Legal Framework: The legal framework for foreign investors has taken a significant leap forward with the rise of the Trust Structure under the 2019 Trust Law. This is now considered the safest and most recommended method for controlling landed property, replacing the previously risky nominee structures. The combination of a more secure legal framework and attractive tax incentives creates a “dual stimulus,” significantly enhancing the appeal of the Cambodian market.
3. A Deeply Polarized Market: Forecasts for the 2025 real estate market show conflicting signals. While high-end segments such as luxury condominiums and Grade-A offices face severe oversupply, low liquidity, and a decline in investment from China, segments driven by real demand—such as affordable housing, industrial real estate, and projects in prime locations—continue to record growth. Rising credit risk and non-performing loans (NPLs) are the most significant concerns, demanding a cautious strategy of segment selection and risk management from investors.

This report will delve into each aspect, from detailed legal provisions to market data and the macroeconomic context, to provide investors with the necessary tools to make informed decisions and build effective investment strategies in Cambodia for 2025 and beyond.

Analysis of Key Legal Amendments and Tax Policies for 2025

The year 2025 witnesses significant efforts by the Royal Government of Cambodia to revive and reshape the real estate market. These measures are not limited to financial incentives but also include administrative and environmental reforms, creating a new, more complex, yet more transparent legal landscape.

Decoding the Multi-Tiered Stamp Duty Incentive Package

The slowdown in the real estate market, particularly after a period of rapid development, has prompted the Ministry of Economy and Finance (MEF) to issue a series of incentives on stamp duty, which has a standard rate of 4% on the property transfer value. These measures are not a single policy but a sophisticated system with different tiers and thresholds, reflecting the government’s targeted intervention in specific market segments facing unique challenges.

A thorough analysis of these incentive thresholds is crucial for investors to accurately determine the benefits and applicable conditions for each type of transaction.

Incentive 1: Stimulating the Affordable and Borey Housing Segment (USD 70,000 Threshold)

This policy clearly demonstrates the objective of supporting local citizens and stimulating the housing segment driven by real demand.

• Content: According to official announcements, the transfer of ownership or possession rights for all types of Borey housing (gated residential communities) valued at or below USD 70,000 will be fully exempt from stamp duty until the end of 2025. For Borey homes valued above USD 70,000, the basis for calculating stamp duty will be reduced by USD 70,000, meaning the buyer only pays tax on the value exceeding this threshold.
• Conditions: To qualify for this incentive, the transaction must be with a Borey developer holding a valid real estate business license and properly registered with the authorities. This indicates the government’s concurrent effort to professionalize the market and protect buyers.
• Strategic Significance: This policy is clearly aimed at reducing the financial burden for middle-income families, making homeownership more accessible. This segment is considered to have stable, real demand and is less affected by speculative factors compared to the high-end market.

Incentive 2: Addressing Inventory in the Mid-Range & High-End Segments (USD 210,000 Threshold)

This is a highly strategic measure directly addressing the oversupply issue in the condominium and high-end housing segments, which attract significant interest from foreign investors.

• Content: From January 1, 2025, to December 31, 2025, first-time homebuyers will be fully exempt from stamp duty on properties (including both condominiums and Borey homes) valued up to USD 210,000. For properties valued above USD 210,000, buyers still benefit as the first USD 210,000 of the property’s value is tax-exempt.
• Conditions: This incentive has two main conditions. First, the purchase or transfer must occur within the timeframe of January 1, 2025, to December 31, 2025. Second, for new purchases, the property must be acquired from a legally registered housing development company.
• Strategic Significance: In the context of a condominium market, especially in Phnom Penh, facing a large oversupply with many options for condo for sale, this policy is a powerful stimulus. It not only significantly reduces the upfront cost for buyers but also helps developers clear their inventory, improve cash flow, and reduce financial pressure. The requirement to purchase from registered developers is also a way for the government to encourage market transparency and formalization.

Impact on Subsequent Transactions

The government also has a policy for investors wishing to purchase more than one property. For the purchase of a second property and onwards, the buyer will receive a deduction of USD 70,000 from the stamp duty tax base. This helps reduce costs for investors looking to expand their portfolio in Cambodia.

Practical Calculation Examples

To clarify the savings, consider the following examples:

• First-time purchase of a USD 195,000 condominium: As this value is below the USD 210,000 threshold, the buyer is fully exempt from stamp duty. The normal tax would be $195,000 \times 4% = $7,800. Thus, the buyer saves the entire $7,800.
• Purchase of a high-end property valued at USD 300,000: The buyer is exempt from tax on the first USD 210,000. The taxable portion is $300,000 – $210,000 = $90,000. The tax payable is $90,000 \times 4% = $3,600. Compared to the normal tax of $300,000 \times 4% = $12,000, the buyer saves $8,400.
• An investor purchases two properties: The first is valued at USD 250,000 and the second at USD 175,000.
  • For the first property: Tax payable is ($250,000 – $210,000) \times 4% = $1,600.
  • For the second property: Tax payable is ($175,000 – $70,000) \times 4% = $4,200.
  • Total tax payable is $1,600 + $4,200 = $5,800. Compared to the total normal tax of ($250,000 + $175,000) \times 4% = $17,000, the investor saves $11,200.

The government’s introduction of strong, targeted tax incentive packages in 2025 is not a random act. Market reports from reputable organizations like CBRE and the IMF have pointed to the weakness in the construction and real estate sectors, oversupply, and rising non-performing loans (NPLs). Therefore, these tax policies are a deliberate response aimed at (1) stimulating weakening demand, (2) helping to resolve large inventories in different segments, and (3) preventing the risk of financial instability spreading from the real estate sector to the banking system. For investors, this is a clear signal of a time-limited “window of opportunity” to leverage government support in a buyer’s market.

Strategic Impact of the Capital Gains Tax Deferral

Besides the stamp duty incentives, one of the most significant policies affecting investor decisions in 2025 is the continued deferral of the Capital Gains Tax (CGT).

• Policy Content: The government has officially confirmed that the implementation of the 20% CGT rate on profits derived from the sale of real estate by individuals will continue to be deferred until the end of December 31, 2025.
• Key Nuance: A critically important point for investors to note is that this deferral only applies to real estate assets held by individuals. The application of CGT on five other types of capital assets—including leases, investment assets, goodwill, intellectual property, and foreign currency—will still commence on January 1, 2025. This distinction shows the government is selectively trying to support the real estate market without affecting the overall tax reform roadmap.
• Impact on Investment Strategy: The CGT deferral creates a one-year strategic window for individual investors. In 2025, they can buy and sell real estate without incurring the 20% tax burden on their profits. This has a dual impact:
  • Encouraging Transactions: It increases the attractiveness of short- to medium-term investment, encouraging existing investors to sell and realize tax-free profits, thereby increasing supply in the secondary market.
  • Supporting Liquidity: In a market considered to have low liquidity, this policy facilitates smoother transactions, supporting overall market stability. Investors might consider a strategy of buying in 2025 to benefit from prices and stamp duty incentives, and then potentially selling before CGT is likely implemented in 2026 or later, thus optimizing their after-tax returns.

New Policies on Tax on Immovable Property (TOIP) and Tax on Unused Land (TUL)

In parallel with measures to stimulate transactions, the government is also “cleaning up” and systematizing the tax administration for existing properties. This reflects a dual strategy: promoting the market while enhancing long-term transparency and compliance.

Tax on Immovable Property (TOIP)

TOIP is an annual tax levied at a rate of 0.1% on the value of immovable property exceeding KHR 100 million (approximately USD 25,000). For 2025, there are important updates regarding its enforcement and amnesty.

• Amnesty Program: The government has introduced a significant tax amnesty program. Accordingly, property owners who have not registered or have misdeclared their tax base in the past will be exempt from administrative penalties (including additional tax and interest) if they voluntarily register and pay their outstanding taxes by the end of June 2025. After this deadline, existing regulations and sanctions will be strictly enforced.
• Exemptions: The policy continues to exempt from TOIP agricultural land being used for cultivation or constructions that directly and permanently support agricultural activities.

Tax on Unused Land (TUL)

TUL, with its 2% annual rate, is designed to discourage land speculation and hoarding.

• Suspension and New Policy: The collection of TUL was suspended until the end of 2024. Starting from January 1, 2025, a new policy on TUL will be officially implemented with significant changes.
• New Policy Content: The most notable feature of the new policy is the tax exemption for unused land plots with an area of less than 5 hectares. For plots larger than 5 hectares, owners can still be exempt if the land meets one of the following conditions: it is under active agricultural cultivation, used for registered economic activities, is leased out, is state-owned, is located within a Special Economic Zone (SEZ), or is registered for educational purposes.

These moves indicate a clear government strategy. On one hand, they offer incentives to “push” new transactions. On the other, they are “cleaning up” the market by encouraging compliance with existing tax obligations and introducing clearer regulations to prevent the waste of land resources. For investors, this means the future investment environment will be safer and more transparent, but will also demand a higher level of legal compliance.

Administrative and Environmental Reforms

Beyond taxes, reforms in administrative procedures and environmental regulations are also key factors shaping the 2025 real estate investment landscape.

• Digitalization of Land Procedures: In a move to modernize and increase efficiency, the Ministry of Land Management, Urban Planning and Construction (MLMUPC) has piloted seven new online public services from January 7, 2025, initially for properties in the capital, Phnom Penh. These services include crucial procedures such as land consolidation, land division, and transfer of ownership for units in co-owned buildings. Applicants can perform these procedures through the MLMUPC’s online portal, streamlining processes and reducing transaction times.
• Updated Environmental Impact Assessment (EIA) Regulations: The Ministry of Environment has issued Prakas No. 3591, effective June 6, 2025, to strengthen the enforcement of EIA regulations. This new regulation expands and clarifies the classification of development projects requiring an EIA, from 197 project types to 238, with a particular emphasis on sectors like mining and industrial production. Concurrently, Prakas 3591 also extends the review period for EIA reports by authorities, aiming to ensure more thorough assessments, promoting transparency and sustainable development.

The following table summarizes the key real estate tax incentives and changes in Cambodia effective in 2025:

Table 1: Summary of 2025 Cambodian Real Estate Tax Incentives and Changes

Comprehensive Legal Framework for Foreign Real Estate Ownership

Understanding the legal framework for ownership is the most fundamental and critical factor for any foreign investor considering the Cambodian market. Despite inherent limitations, Cambodia’s legal system has evolved to provide increasingly secure and transparent mechanisms.

Foundational Regulations: Limitations and Opportunities

The Cambodian legal framework sets clear limits but also opens specific pathways for foreign investors.

• Prohibition of Land Ownership: The core and unchanging rule, stipulated in Article 44 of the Cambodian Constitution, is that only individuals or legal entities of Khmer nationality can own land. This means foreigners cannot directly hold title to landed properties like plots of land, villas, or shophouses.
• Condominium Ownership (Strata Title): This is the most direct, legal, and common way for foreigners to own real estate in Cambodia. The 2010 Law on Foreign Ownership created this mechanism with specific conditions:
  • Floor Level Restriction: Foreigners are only permitted to own units from the first floor upwards. They cannot own ground-floor and basement units, as these are considered to have direct contact with the land.
  • Ownership Ratio Limit: The total floor area of foreign-owned units in a single co-owned building cannot exceed 70% of the total private floor area of that building. The remaining 30% must be owned by Cambodian citizens.
  • Building Type Requirement: The building must have been constructed from 2010 onwards and must be registered as a “co-owned building” with separate strata titles for each unit.
  • Geographical Requirement: The building must be located at least 30 kilometers from Cambodia’s land borders.

In-Depth Comparison of Land Control Mechanisms

For investors looking to access landed properties, such as those searching for land for sale, villas, or development projects, choosing an indirect legal structure is mandatory. The evolution of Cambodia’s legal system, especially the introduction of the Trust Law, has been a game-changer, offering options with varying degrees of security and complexity.

• Trust Structure:
  • Description: Formalized by the 2019 Trust Law, this mechanism allows a foreign investor (the Trustor) to transfer legal ownership of an asset (e.g., a plot of land) to a licensed company in Cambodia (the Trustee). The Trustee holds and manages the asset for the benefit of the investor (the Beneficiary) under the terms of a trust deed.
  • Analysis: This is rated by leading law firms and professional service providers as the safest, most transparent, and most recommended method today. It completely replaces the informal and highly risky nominee arrangements of the past. The structure is legally protected, highly enforceable, and minimizes investor risk because the Trustee is a licensed entity supervised by the Trust Regulator.
• Land Holding Company (LHC):
  • Description: A foreign investor establishes a limited liability company in Cambodia, holding up to 49% of the shares, with one or more Cambodian citizens holding at least the remaining 51%. This company, as a Khmer legal entity, can then legally purchase and hold title to land.
  • Analysis: While this is a legal structure, it has several drawbacks. First, it carries inherent control risks, as the foreign investor is a minority shareholder. Although complex shareholder agreements can be used to mitigate this risk, they can still be challenged. Second, establishing and operating a company requires initial costs and ongoing compliance obligations (like monthly tax filings and financial reporting), increasing cost and complexity. Due to these risks and costs, some law firms no longer recommend this method.
• Long-Term Lease:
  • Description: A foreigner can sign a lease agreement directly with a Cambodian landowner. The lease term can be long, typically from 15 to 50 years, and can be renewable, in some cases up to 99 years.
  • Analysis: This is a safe, simple, and legally recognized option. It gives the investor control and use of the land for a long period, sufficient to carry out business projects or construction. However, its main drawback is that it does not confer actual ownership, and the investor does not benefit from the capital appreciation of the land when the lease ends.
• Nominee Structure:
  • Description: A Cambodian citizen holds the title deed on behalf of a foreign investor, based on a private agreement or side contracts.
  • Analysis: This is the highest-risk, illegal, and absolutely not recommended method. The associated side agreements are not enforceable in court because they contravene the Constitutional prohibition on foreign land ownership. The investor risks losing the entire asset if the nominee dies, changes their mind, or encounters legal trouble. The advent of the Trust Law has made this method obsolete and more dangerous than ever.

The rise of the Trust structure is a turning point, reflecting the maturation of the Cambodian real estate market. It shifts the investment model from one based on personal trust (with Nominee and LHC structures) to one based on institutional trust (with licensed and supervised Trustees). This not only minimizes legal risk but also opens the door for institutional investors and those seeking security and transparency that meet international standards.

The table below provides a detailed comparison of land control mechanisms for foreign investors:

Table 2: Detailed Comparison of Land Control Mechanisms for Foreign Investors

Mandatory Due Diligence Process

Regardless of the chosen structure, conducting careful and comprehensive due diligence is an indispensable step to protect the investment.

A basic due diligence checklist must include the following items:

• Title Verification: The most critical step is to verify the type and validity of the title deed. Investors should prioritize properties with a “hard title” or a “strata title,” as these are registered at the national land management authority and have the highest legal standing. “Soft titles,” which are only recognized at the local level and can be subject to disputes, should be avoided.
• Legal Encumbrances Check: It is necessary to check at the cadastral office to ensure the property is not mortgaged, pledged, subject to a transactional injunction, or involved in any legal disputes.
• Owner Verification: The seller must be verified as the legal owner of the property by cross-referencing information on the title deed with their personal identification documents.
• Developer and Permit Checks: For new or under-construction projects, investigating the developer’s reputation, financial capacity, project completion history, and necessary permits (investment license, construction permit) is crucial to avoid risks of project delays or poor quality.
• Physical Inspection: A physical inspection of the property to assess construction quality, location, surrounding infrastructure, and potential risks like flooding is essential.

Market Context and Outlook for Cambodian Real Estate in 2025

The Cambodian real estate market in 2025 is in a complex phase, with indicators and forecasts painting a multi-dimensional picture of significant challenges coexisting with opportunities for well-prepared investors.

Contrasting Market Analyses: “Challenging” vs. “Recovery”

Reports from leading consulting and market analysis firms show somewhat contradictory views, reflecting a deeply polarized market.

The “Challenging” Thesis

This perspective, primarily led by analyses from CBRE, paints a rather bleak picture.

• Pessimistic Forecast: CBRE predicts that 2025 will be even more difficult than 2024, and a real recovery may not arrive before 2026.
• Primary Causes: The core factors leading to this situation include:
  • Severe Oversupply: The market has overproduced in the last 5 years, leading to a situation of “too much of everything.” The supply of condominiums in Phnom Penh is projected to reach up to 80,000 units by the end of 2025.
  • Low Liquidity: Reselling properties has become more difficult, especially in high-end segments.
  • Decline in Chinese Investment: The slowdown in capital flows from China, which was the main driver during the previous boom, has left a significant void.
• Most Affected Segments: CBRE’s report identifies the most heavily impacted segments as serviced apartments, condominiums (especially high-end), Grade-A offices, and new shopping malls.

The “Recovery and Growth” Thesis

Conversely, other data sources and analyses point to positive signs of recovery, especially when looking at specific segments and regions.

• Price Growth: Some reports note that property prices in prime locations in Phnom Penh have seen an increase of 5-10% since the beginning of 2025.
• Driving Forces: This recovery is supported by solid fundamental factors, including:
  • Economic Growth: The Cambodian economy is forecast to continue its strong growth trajectory.
  • Infrastructure Development: Large-scale infrastructure projects like new airports and expressways are being implemented, improving connectivity and opening up new development areas.
  • Government Support Policies: The 2025 tax incentive packages and debt restructuring programs for homebuyers are directly supporting the market.
• Real Demand: Experts also assert that real demand persists and remains strong in the affordable segment and for projects in strategic locations developed by reputable and experienced developers.

The contradiction in these reports is not necessarily an error but accurately reflects the nature of a deeply polarized market. While CBRE focuses on issues at the top end of the market—the heavily oversupplied luxury segment—other reports see positive movement in segments driven by real demand and in areas benefiting from infrastructure. For investors, this means that selecting the right segment and location has become more critical than ever. The Cambodian market in 2025 is not a monolith, and success or failure depends on the ability to see past the headlines of “boom” or “bust” to find specific opportunities.

Macroeconomic Drivers and Risks

For a holistic view, the real estate market analysis must be placed within the broader macroeconomic context.

Macroeconomic Forecasts

Major international organizations offer varying GDP growth forecasts for Cambodia in 2025, indicating a degree of uncertainty:

• Asian Development Bank (ADB): Forecasts 6.1% growth.
• International Monetary Fund (IMF): Forecasts 5.8% growth.
• World Bank: Has revised its forecast down to 4.0%, reflecting concerns about headwinds from both domestic and external sources.

Despite the differences, all forecasts show that the Cambodian economy maintains a positive growth momentum, supported by exports and the recovery of the tourism sector.

Key Risks

• Credit Risk and Non-Performing Loans (NPLs): This is considered the biggest systemic risk and the “elephant in the room.” Reports from the IMF and World Bank have repeatedly highlighted the slowdown in credit growth after a long period of expansion, along with a rapid increase in the NPL ratio in the banking and microfinance sectors. A large portion of these bad loans is linked to the struggling construction and real estate sectors. If the NPL situation worsens, banks may further tighten lending conditions, reducing market liquidity and potentially triggering a deeper price correction.
• Dependence on Foreign Investment: The sudden drop in investment flows from China has exposed the market’s vulnerability when relying too heavily on a single source of capital. Diversifying investment sources is a major challenge.
• Oversupply: As analyzed, the oversupply in high-end segments puts significant pressure on rental rates and occupancy, reducing the appeal for pure-play investors seeking rental income.

Identifying Potential Investment Segments

In a challenging market, identifying potential segments and market niches is key to success.

• Expert Recommendations (CBRE):
  • Repurposing and Renovation: Instead of continuing to build new projects in saturated segments, developers should focus on repurposing and renovating existing buildings to meet new market demands.
  • Budget Hotels: Investing in 1- to 3-star hotels may yield better results than luxury 5-star hotels, which face fierce competition.
  • Industrial and Logistics Real Estate: This sector is highly attractive due to supply chain shifts and the growth of Cambodia’s manufacturing industry.
• Emerging Market Niches:
  • Specialized Housing: There is growing demand for specialized housing types such as student accommodation and senior living facilities.
  • Affordable Real Estate: The affordable housing segment continues to show strong and sustainable demand from the local population.
  • Branded Residences: This is a new trend, attracting buyers seeking quality and professional management services.

The decline of speculative capital from China is forcing the market to reposition itself. The next phase of development will no longer be based on a “fever” but will be shaped by more sustainable factors: real demand from the local population, more diversified FDI flows, and the growth of real economic sectors like manufacturing and industry. The experts’ recommendations are a reflection of this repositioning. Smart investors will not wait for the old model to return but will proactively seek opportunities in the market’s “new normal.”

The table below compares market forecasts and assessments from reputable organizations:

Table 3: Comparison of 2025 Real Estate Market Forecasts from Reputable Organizations

In-Depth Investment Strategies and Recommendations

Based on detailed legal and market analyses, this section provides specific strategies and recommendations to help investors navigate the complex landscape of Cambodian real estate in 2025, optimizing benefits and managing risks effectively.

Optimizing Benefits from 2025 Tax Policies

The tax incentives in 2025 create a distinct financial opportunity. To maximize them, investors need a smart strategy for selection and transaction structuring.

• Asset Selection Strategy: A prudent strategy is to prioritize searching for properties valued just below the key incentive thresholds. For example, choosing a condominium priced at USD 205,000 instead of USD 215,000 could save the entire USD 8,200 in stamp duty, a significant saving on the total investment cost.
• Investment Structuring Strategy: Instead of buying one large property, an investor might consider dividing their investment to purchase several smaller properties. This strategy allows leveraging the exemption thresholds for each individual transaction, especially when combining the first-time buyer incentive with the incentive for subsequent properties.
• Timing Strategy: The deferral of capital gains tax until the end of 2025 is a critical factor. Investors currently holding property with an intention to sell should consider transacting this year to realize profits without the 20% tax burden. For new investors, this is an opportunity to buy in at a lower cost and have a period for the property’s value to appreciate before the tax is likely reintroduced in 2026.

Choosing the Right Investment Structure for Each Scenario

Selecting the legal structure to hold real estate is one of the most important decisions, directly impacting the investor’s security and level of control.

• Scenario 1: An individual investor buying a condominium for personal use or rental.
  • Recommendation: Use direct ownership via a Strata Title. This is the simplest, safest, most cost-effective, and efficient path for this purpose. The investor will have full and legal ownership of their unit. Combined with the stamp duty incentive for properties under USD 210,000, this is the optimal choice.
• Scenario 2: A foreign investor wanting to buy a land plot, a villa, or develop a small project.
  • Recommendation: Use a Trust Structure. As analyzed, this offers the best balance of legal security and control over landed property. By working with a licensed Trustee company, the investor can ensure their economic interests are protected transparently and robustly by law.
• Scenario 3: A large institutional investor developing a large-scale project.
  • Recommendation: A more complex hybrid structure may be considered, such as using a Trust Structure to hold the land and establishing a Land Holding Company (LHC) to carry out the operational and development activities. Additionally, for large projects meeting government criteria, applying for Qualified Investment Project (QIP) status can bring numerous additional incentives on corporate income tax and other taxes, beyond the standard real estate incentives.

Navigating Risks and Market Pitfalls

The Cambodian market, while attractive, still holds many risks. Identifying and planning for them is a prerequisite for success.

• Liquidity Risk: The current market is not suitable for short-term “flipping” strategies. Investors need to be prepared for a medium- to long-term horizon and should not invest capital that may be needed in the short term.
• Legal Risk:
  • Absolutely Avoid the Nominee Structure: This is the biggest and most dangerous pitfall. Any investment through this method is at risk of total loss.
  • Thorough Due Diligence: Always conduct a comprehensive due diligence process before signing any agreement. Only work with reputable law firms, trust companies, real estate agents, and developers with clear licenses.
• Oversupply Risk: Thorough market research is needed to avoid heavily oversupplied segments like ultra-luxury condos or Grade-A offices in non-prime locations. Instead, focus on segments with real and sustainable demand, such as affordable housing, industrial real estate, or products serving niche markets like tourism or education.
• Construction Quality Risk: Do not rely solely on marketing brochures or 3D renderings. A physical inspection of the property’s construction quality and an investigation into the developer’s history and capacity are critically important.

Conclusion

The year 2025 is a pivotal, decisive year for the Cambodian real estate market. Extensive analysis of the legal framework, tax policies, and market dynamics reveals a complex picture where challenges and opportunities coexist and intertwine.

First, the 2025 tax incentives, particularly the stamp duty exemptions and the capital gains tax deferral, are a strategic and time-limited government intervention. This is not just a simple stimulus but a deliberate effort to address endemic market issues like oversupply and low liquidity. For investors, this creates a special “window of opportunity” to enter the market or restructure portfolios at a significantly lower cost.

Second, the legal framework for foreign real estate ownership has reached a new level of maturity. The emergence of the Trust Structure as a safe and legally protected method for controlling landed property is a revolutionary change. It substantially reduces legal risk, which was previously the biggest barrier for international investors, and brings Cambodia’s investment environment closer to international standards.

Third, the market is undergoing a deep polarization. While high-end segments, dependent on speculative capital, are facing difficulties, segments driven by real demand and sustainable economic factors continue to show growth potential. Credit and NPL risks are real and need to be monitored closely.

In summary, Cambodia in 2025 is no longer a market for speculators or those seeking quick profits. Instead, it opens doors for strategic, well-prepared, and long-term investors. Success will come to those who can:

• Effectively leverage tax incentives within the limited timeframe.
• Choose smart and secure legal structures, prioritizing the Trust structure for landed properties.
• Conduct comprehensive due diligence to avoid legal and quality pitfalls.
• Correctly identify investment segments and locations, focusing on areas with real demand and sustainable infrastructure potential.

In the context of a market that is self-correcting and repositioning, the decisions made in 2025 will have a profound impact on the success of investment portfolios within the cambodia property market for years to come.