Stages of a Metropolis Real Estate Market Development on the Example of Phnom Penh

📈 How does a metropolis real estate market evolve? Where does Phnom Penh stand on this path? The real estate market of a metropolis, especially a capital city, always undergoes certain developmental phases, which can be divided into stages:

1️⃣ Formation – The initial stage when the city begins active development: key infrastructure projects are built, and investment inflow is limited.Example: Dubai in the 1990s. I’ve spoken with people who witnessed Dubai’s early days.📍 These same individuals now strongly believe in Phnom Penh’s potential.

2️⃣ Growth Boom – A sharp surge in demand for housing, commercial, and office real estate. Mass construction begins, prices skyrocket, and foreign interest intensifies.Example: Moscow in the early 2000s. My favorite example: construction pits, triple-digit returns for risk-takers, but also unfinished projects and defrauded equity holders.📍 Phnom Penh is currently at this stage. We understand how to navigate it.

Stages of Metropolis Real Estate Development: Phnom Penh is on the Border Between "Growth Boom" and "Stabilization"

3️⃣ Stabilization – The market matures: supply and demand balance, price growth slows, returns decrease, but stability emerges. Regulations increase, making the market safer for long-term investments.Example: Bangkok in the 2010s. Investors who recognized its potential shared this story with me.📍 Phnom Penh is approaching this phase. Market equilibrium is expected within 5–8 years.

4️⃣ Saturation – Signs of overheating emerge: supply exceeds demand, price corrections become possible.Example: London from 2010–2020. Prices soared beyond affordability, prompting stricter regulations and investor taxation.

📍 For Phnom Penh, this stage lies ahead. Long-term monitoring of market saturation is critical.

📍 Conclusion: Cambodia’s capital is transitioning between "growth boom" and "stabilization."

Phnom Penh looks like any modern metropolis where history meets 21st-century urbanization: historic buildings and skyscrapers, with the construction of a multi-story residential complex visible in the background of the photo.

Over the past decade, Phnom Penh’s real estate market has exploded from virtually nothing — the "low base effect" in action. Foreign investors have arrived: 50-story skyscrapers are rising, 75-story towers are planned. Elite residential complexes (still few in number), malls, and offices are emerging. Reasons include:

• Flexible property laws, low taxes, and a growing economy.

• The government’s strategy to attract foreign capital.

• Investor confidence that the "Asian Tiger" is a deliberate model, not a fluke.

Opportunities for Investors:

✅ High rental demand from expats, entrepreneurs, and tourists.

✅ Emerging zones: riverside areas, Arey Ksat New City across the Mekong, and commercial hubs.

✅ Infrastructure megaprojects: international airports, capital bridges, modern intercity highways.

✅ Rental yields of 8–10% annually.

✅ Government support: foreigners can own condominiums, minimal investment restrictions, near-zero taxes.

📊 Phnom Penh — a city with immense potential, especially in the medium term. Those entering the market now can capitalize on high returns before stabilization.

Tip: To avoid risks inherent in a booming market, choose a reliable guide. Follow my Telegram @camboinvestor and watch a free real estate investment masterclass: https://watbot.ru/w/e8we 

Read More:

→ How Cambodia Turns Infrastructure into Investor Profits

→ Cambodia: From Temple Empire to the New "Asian Tiger" Building Its Own Dubai

→ Key Updates for Cambodia Real Estate Investors by 2025