Wednesday, December 10, 2008

Spending down as land sales fall

Mel Trea's spending days are temporarily over. (Photo by: Heng Chivoan)

Wednesday, 10 December 2008
Written by Soeun Say
The Phnom Penh Post


Businesses feeling crunch as fewer land sales mean fewer new rich with money to burn

THE end of Cambodia's property boom is increasingly being being felt across the economy as a downturn in land sales means fewer newly-rich Cambodians hit the capital with money to spend.

Sam An, 43, who runs a private automobile dealership on Phnom Penh's Monivong Boulevard, said his sales have declined by up to 50 percent over the last six months from a peak during the building boom of 2006, 2007 and the early part of 2008.

"Many of our buyers made a lot of money from selling land and came to buy cars here," he said. "Now they are so quiet."

Sok Narin, 28, said he used to make a handsome profit from selling Suzuki motorbikes from his private dealership in 7 Makara district to people arriving from the provinces with cash in hand.

"At this time last year I sold between four and five motorbikes per day, but now my business is very quiet," he said. "I think that this is because the property market is not good."

Cambodia's sole Toyota distributor, TTHK Co Ltd, told the Post last month that it has sold only 1,200 vehicles this year, well short of the 2,000 previously anticipated, after sales plummeted almost 50 percent since May.

RM Asia Co Ltd, the country's second-largest automobile importer, said sales of Ford vehicles have declined about 10 percent within the last few months.

Va Teang, 35, who owns a gold shop at Pochentong Market in Phnom Penh, said her income has dropped 50 percent because of the real estate market slowdown.

Mel Trea, 72, a farmer-turned-land speculator from Prakar village in the outskirts of Phnom Penh, said the land boom had made him rich over the past five years.

"I never thought that I would have a great chance like this," he said.

"I earned a lot of money from land I sold during 2006 and 2007 when the land was fetching very high prices. If I had bought land for $1,000 per hectare I sold it at $10,000 per hectare; if I bought at $10,000 I sold at $100,000."

With the proceeds, he built a villa for his family and bought cars and motorcycles. With few buyers around, his wealth is locked up in his remaining land bank and his spending money has dried up.

"Now, the property market is very quiet," he said. "It's not like the last few years when I was very busy speculating."

Kang Chandararot, president of the Cambodia Institute of Development Study, said it was inevitable that the slowdown in real estate sales would be felt throughout the economy.

"The world economic crisis has already affected the real estate market in Cambodia," he said. "If the real estate market collapses, it can make life difficult for other people doing businesses in Cambodia, especially car and motorbike sellers."

Ngy Tayi, undersecretary of state at the Ministry of Economy and Finance said the government was considering how it could intervene to boost the sector.

"I can't give you an answer as to what we will do, but I can say the government is discussing the issue and considering helping them in the near future," he said.

12 comments:

Anonymous said...

good luck all you monkeys

Anonymous said...

all khmer should hold on land and money to spending in econimic crsis .it will downfall with deeply in three years at least .
recently .the big power and guider of ecnomic effort to drop the gas price down to help ,but it can't start up and still bare to down slop. so we all must becarefully to spending.
may all khmer with peace stable to comfort everyong.

Anonymous said...

Khmer people Knong Srok keeps speculate the land and make good money. Now they busted and no more show off. Even Khmer Krout Srok russed to buy land and property in Cambodia; now they stuck too.

Lucky I don't invest a penny in Cambodia. I know CPP does not control the price and let the rich and their croanies do whatever they want.

So don't show off with your dollars and diamond. We, oversea people, are not amazed with your overnight dollars.

Anonymous said...

What the fuck with you 5:12AM ? you are fucking Pol Pot sucker try to devide Cambodian???


May ligtning strike youu soon!!!!

Anonymous said...

The Cambodian gov is self-contradictory. A few weeks ago, all gov officials including PM Samdech HunSen, and garment union leader all assured that Cambodia was not effected by the global economic crisis.

Now Ngy Tayi, undersecretary of state at the Ministry of Economy and Finance said the government was considering how it could intervene to boost the [real estate] sector.

Thank God, all of us are not blind, and we were open to listen to what have happened on the globe.

Now the impact are very clear on construction, real estate, textile, and tourism. What else are in the line next? and How much Cambodian gov can do about it while the world leader, USA, is struggling with their economic plan?

Anonymous said...

I think the government should buy up all the appartment and give away to all residents of Bung Kak and Dey Krahoam.

Anonymous said...

4:46AM, It was difficult to understand your posting. You need to put more afford to the writing. No offense!!! I began my script the same way.

5:12 AM. I am Khmer oversea and I am amazed when come to dollars and diamonds. I am glad that you don’t invest any money in Cambodia because a penny won’t give you a much in return. And please don’t use the word “We”, because you offended many oversea Khmer who loathe your silly comment. Stop being a sour grape. We should be happier for our fellow Khmer who are thriving through respectable trade.
100% Khmer at heart
USA

Anonymous said...

12:33am,

I am glad that you eventually know yourself!!!Do you know that Monkey possess an intelligence that surpasses other animals. Pat yourself on the back and be very proud that you are part of the elite bunch. And don't forget to embrace your parent for their upbringing!!!
Hanoman.

Anonymous said...

Land in Siem Reap. $2/sqm 13km from Town. National Road Nº 67 (road to Banteay Srey Temple).
(85516 308 213)

Anonymous said...

I'm Khmer overseas and I did invest in land not house in Cambodia. I visited Cambodia in May 2007, I told my care of persons to sell off 85% of my land by the end of October but no later than November 2007. I knew that the economic loom is coming far early than Alan Greenspan and George Bush. In USA, I sold my stocks in EXXON/MOBIL and BP after the first presidential debate. Now the oil is at $ 43.25 per barrel as yesterday.

The price of land in Cambodia will
go up again but not as out of control as 2006, 2007. I start to buy back now and keep until 2011 except one thing, I hope Cambodia political atmosphere continues to be stablem, which is more likely. Oil will go up to $ 70 or $ 80 in Mid-Summer 2009 and top $ 100 in 2010 as well as construction related commodities.

Anonymous said...

5:30AM and 7:35AM

For 5:30AM: The lightning won't strike me, but you. I'm living near the White House and a lot of missils around DC so it will protect me from any strike. Plus, I'm engineer who designs lightning protection so the lightning won't strike me, Ah Pleur. Here are some advice for your home and business. Need ground ring or ground loop connected to air terminals on the roof. Place the air terminals every 25 feets and 2' away from the roof edge. Place the air terminal at the highest point especially chimney and HVAC equipment. As I said "Lightning won't strike me, but you and your family". Also I'm not Khmer rouge, but you're sucker is the Pol Pot. You know I hate Khmer rouge, Hun Sen, Sihanouk, and CPP people including you, fucker.

For 7:35AM: I'm not including you as we. You're not one of our, idiot. I'm talking straight and if you don't like it. it's better to shut your urgly mouth. You're dumb head and think penny won't get rich. Look at millionaire people. They're selfish and penny sucker. They save every penny. That's why they're millionaire. I'm glad I'm not stupid like you to invest in Cambodia. Not a penny, my friend. Suck your mouth.

DON'T NEED TO REPLY AND I WON'T REPLY BACK AS SIHANOUK TOLD HIS EMAILERS YESTERDAY. NO MORE RESPONSE FROM YOUR KING.

Anonymous said...

9:17
Smart cookie, that's what you are. So you did sell your land in Nov. 2007? If you had waited just a little longer you could have made even more money if you had waited until March 2008. I am in business in Cambodia myself. I'd like to get in touch with you. My email is camnews001@gmail.com