Property Wire
Cambodia introduces new real estate regulation
New regulations are being introduced in Cambodia to protect property investors from fraud as the country's real estate industry booms.
Developers will be required to deposit a sum with the National Bank of Cambodia before being allowed to begin construction on a project under new regulations aimed at curbing fraud.
Payments from buyers will be held in this account with the aim of making the whole payment system more transparent and avoid developers using money illegally. It will also allow the government to intervene if developers fail to honour their contracts.
Real estate agents and developers will have to obtain a licence from the Ministry of Economy and Finance to sell projects and face legal action and even closure if they fail to do so.
The new rules mean developers and agents must comply by the end of September, a spokesman for the Economy and Finance ministry said.
There will be costs to the developers and agents involved but officials believe this will deter cowboys. 'Real estate developers will be required to deposit 2% of the projects' total value at the National Bank of Cambodia,' said Mao Pao deputy chief of the ministry's real estate division.
'We will require a developer to open a housing development account at any commercial bank to enable buyers to make payments through the bank,' he added.
The price for the new licences for selling or renting will depend on the scale of the project. Until now developers only needed a letter of permission from the Ministry of Land Management, Urban Planning and Construction and an investment licence from the Council for the Development of Cambodia.
There are estimated to be around 100 developers currently operating in Cambodia, many of them quite small. Some said the new regulations will be too costly and put them out of business.
Capital Phnom Penh has undergone an unprecedented construction boom over the last several years, including a number of residential and commercial mega-projects that are set to transform the capital from a sleepy backwater.
New regulations are being introduced in Cambodia to protect property investors from fraud as the country's real estate industry booms.
Developers will be required to deposit a sum with the National Bank of Cambodia before being allowed to begin construction on a project under new regulations aimed at curbing fraud.
Payments from buyers will be held in this account with the aim of making the whole payment system more transparent and avoid developers using money illegally. It will also allow the government to intervene if developers fail to honour their contracts.
Real estate agents and developers will have to obtain a licence from the Ministry of Economy and Finance to sell projects and face legal action and even closure if they fail to do so.
The new rules mean developers and agents must comply by the end of September, a spokesman for the Economy and Finance ministry said.
There will be costs to the developers and agents involved but officials believe this will deter cowboys. 'Real estate developers will be required to deposit 2% of the projects' total value at the National Bank of Cambodia,' said Mao Pao deputy chief of the ministry's real estate division.
'We will require a developer to open a housing development account at any commercial bank to enable buyers to make payments through the bank,' he added.
The price for the new licences for selling or renting will depend on the scale of the project. Until now developers only needed a letter of permission from the Ministry of Land Management, Urban Planning and Construction and an investment licence from the Council for the Development of Cambodia.
There are estimated to be around 100 developers currently operating in Cambodia, many of them quite small. Some said the new regulations will be too costly and put them out of business.
Capital Phnom Penh has undergone an unprecedented construction boom over the last several years, including a number of residential and commercial mega-projects that are set to transform the capital from a sleepy backwater.
4 comments:
Tnis is how the officers of Hun Xen government make money. They are very good at creating jobs to make money. You know how much you have to pay bribe to get the license from the ministry of finance. It is millions of dollars of bribe involved with this new procedure. Similar approval procedures have been created in various departments of the gov't such as CDC, Ministry of Commerce, Tax Department, Customs and Excise Department etc. Lot of bribes
this is good idea to have in place as it will prevent fraud from bad people with bad intention, of course. god bless cambodia.
If I stole your land tonight, with a signature of the prime minister, would you dare to take me to court. Perhaps you need to reconsider. Fraud! This new red tape would not prevent fraud; this shit happens everywhere in Cambodia.
Practically everything is illegal, you name it.
Before I go, remember, who in charge of Cambodia.
Study the trend before you involve yourself with any transaction. Look for an agent who you think you can trust. Run a little background check of the agency.
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