Phnom Penh’s high-end condominium sector remains a focal point for Singaporean outbound real estate investors seeking solid annual returns, according to recent statistics
Cambodia has remained one of the most desirable locations for offshore property investments by Singaporean nationals over the past three-year period, said a data released by the Shanghai-based global real estate consultancy, Juwai IQI recently. Landing in the top 10, Cambodia took out the ninth position in the world rankings, receiving 3.3% of all Singaporean outbound real estate enquiries.
Based on Juwai IQI data on property enquiries made by property buyers located in Singapore between January 2020 and November 2023, the Juwai IQI global ranking seeks to summarize the preferences of Singaporean property investors when considering overseas investments worldwide and predict future trends.
The analysis noted that Cambodian investments in both property development and individual condo units remain competitive to Singaporean owners looking for stronger investment returns than domestic real estate assets are able to generate. In particular, Singaporean property developers and investors are making their presence known in the high-end condominiums development sector in Phnom Penh, Cambodia, the report noted.
The study explains that while yields in Singapore itself remain attractive by international standards, averaging 4.8% annually, returns on Singaporean-based assets are still significantly below the 6 to 7% average rental yield reported for properties located in Phnom Penh.
Australia was positioned number one in the portal’s global rankings, receiving 27.5% of all outbound enquiries from Singaporean buyers. This significant share reflects Australia’s unique popularity among Singaporean investors due to factors such as cultural ties, educational opportunities, a stable real estate market, lifestyle, and proximity to Singapore, noted Juwai IQI’s analysis.
Placing second was Cambodia’s neighbour and ASEAN member state, Thailand, with 16.5% of all outbound enquiries in the survey period. According to the data, Singaporeans favour Thailand for their offshore investments as properties remain considerably more affordable than those in Singapore, meanwhile offering potentially higher rental returns than Singaporean-based assets. Malaysia came in third place with a 13.2% share; followed by Japan: 12.6%; Vietnam: 5.5%; Canada: 3.8%; US: 3.3%; Cambodia: 3.3% and finally Indonesia in tenth place, with 2.7% share of all enquiries.
Juwai IQI said that while the global focus has been on Chinese overseas real estate buyers for the past decade and a half, buyers from Singapore have been active for longer. Furthermore, while the total international residential real estate investment out of Singapore is not comparable to the total from China, it still far outpaces any other country on a per capita basis.
Juwai IQI cited several reasons that Singapore is one of the world’s top buyers of international real estate, the most significant being the Singaporean cultural preference for property investment and an abundance of capital. A small country with a constrained domestic market, Singapore is characterised by high levels of wealth and an international outlook.
The report noted that the primary reasons that Singaporean investors purchase overseas residential real estate in locations, including Australia, Cambodia and other countries worldwide, are to diversify their investments, take advantage of Singapore’s strong dollar exchange, avoid higher transaction costs at home, provide housing for their children who are studying abroad or obtain second homes for retirement and holidays.
