Tuesday, December 16, 2008

Experts predict Cambodian real estate market to recover by 2010

PHNOM PENH, Dec. 16, 2008 (Xinhua) -- Economists said that the nearly one billion U.S. dollars in foreign aid pledged to Cambodia by donor nations last week could boost the country's sagging real estate market as early as 2010, national media reported Tuesday.

Kang Chandararot, president of the Cambodia Institute for Development Study, told the Phnom Penh Post that he expected the real estate market will rebound in two years, largely on the strength of foreign aid.

"If the government uses the aid to develop the country...then I think real estate may begin to stabilize," he was quoted as saying by the Post.

But he cautioned that aid would not boost prices to the unprecedented levels seen last year.

Local real estate peaked in 2007 and 2008, partly driven by South Korean investment.

The market started to drop in September, although low transaction volume and scant figures make the depth and impact difficult to assess.

Kang Chandararot said foreign investment would be key to rebuilding the sector, but that other factors, such as the global economic crisis and border tensions with Thailand, could remain obstacles to growth.

Hang Choun Naron, secretary general for the Ministry of Economy and Finance, agreed that the sector was poised to recover.

"I (think) the real estate market will return to normal within the next two or three years," he told the Post.

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