Phnom Penh Property: Price per sqm and Real Yields in 2026

In Cambodia's capital, a square metre of premium condominium space costs roughly what a compact studio apartment runs in many mid-tier European cities. At the same time, gross rental yields reach 7-9% annually, and every transaction is denominated in US dollars. For international investors seeking diversification outside euro-zone assets, Phnom Penh in 2026 offers a rare combination: a low entry barrier paired with dollar-denominated cash flow.

The city now counts more than 2.4 million residents and is expanding at approximately 3.5% per year. According to World Bank data, Cambodia's GDP grew at an average of 5.3% between 2022 and 2025. This is not a speculative frontier market in the vein of pre-pandemic Sihanoukville. It is a growing metropolis with genuine demand for housing from an emerging middle class, a significant expat community, and workers across the garment and technology sectors.

Quick answer

• Price per sqm in Phnom Penh (condominium, hard title, from the first floor upward): from $1,400 (Meanchey district) to $3,800 (BKK1, Tonle Bassac)
• Gross rental yield: 7-9% in the mid-range segment, 5-6% in the premium segment
• Transaction currency: USD - no exposure to Cambodian riel (KHR) volatility
• Minimum entry budget: realistically from $55,000-$70,000 for a 35-45 sqm studio in Toul Kork or Chroy Changvar
• Foreign ownership: full freehold (hard title) available exclusively in registered condominium buildings, from the first floor upward, with foreigners collectively capped at 70% of total building floor area
• Annual property tax: 0.1% of assessed value (above the threshold of approximately $25,000)

Options and scenarios

Scenario 1 - Short-term rental studio in Tonle Bassac

Tonle Bassac and the adjacent BKK1 district form the centre of expat life in Phnom Penh: international restaurants, NGO offices, embassies, and international schools. A 35 sqm studio in a newly completed condominium here is priced at approximately $105,000. At a monthly rent of $750 and an 85% occupancy rate, the gross annual income is approximately $7,650, implying a gross yield of 7.3%.

After deducting property management fees (typically 10-15% of rent), common area maintenance charges (around $1.50 per sqm per month), and withholding tax on rental income (10% for non-residents), net yield settles at approximately 5.0-5.5% - still materially above what comparable assets generate in most Western European capitals.

Scenario 2 - Two-bedroom apartment in Toul Kork for long-term rental

Toul Kork is a rapidly urbanising district popular among the Cambodian middle class and a sizeable Korean expatriate community. A two-bedroom unit of 55-65 sqm is priced at $75,000-$95,000. Long-term rental rates run at $550-$700 per month, translating to a gross yield of 8.0-8.8%. Lower tenant turnover reduces management costs, making this the more defensive income-focused scenario.

Scenario 3 - Off-plan purchase with discount, resale before completion

Developers in Phnom Penh typically offer staggered payment schedules over 24-36 months, with discounts of 10-20% relative to the final completion price. An investor pays 30% in instalments and then assigns the contract before handover. The potential upside is real, but so is the risk: secondary market liquidity is limited, and unwinding a pre-sale agreement can be costly. This approach demands thorough due diligence on the specific developer and precise understanding of local demand in the target submarket.

Full calculation - Toul Kork scenario

Purchase price: $85,000 (60 sqm, $1,417/sqm) | Transaction costs (4% transfer tax, legal fees, due diligence): approx. $4,200 | Total capital deployed: $89,200 | Gross rent: $650/month x 12 = $7,800/year | Annual costs (12% management, $1,080 common area fees, 10% rental withholding tax): approx. $2,700 | Net income: $5,100 | Net yield on total invested capital: 5.7%

Potential capital appreciation in central districts is estimated by market observers at 3-5% annually, but in an emerging market context, investment theses should be built on income, not on price appreciation alone.

Comparison table

Parameter	Phnom Penh - BKK1/Tonle Bassac	Phnom Penh - Toul Kork	Phnom Penh - Chroy Changvar	Bangkok - Sukhumvit
Price per sqm (USD)	$2,800 - $3,800	$1,400 - $1,800	$1,200 - $1,600	$4,500 - $7,500
Gross rental yield	5 - 7%	7 - 9%	6 - 8%	4 - 5%
Transaction currency	USD	USD	USD	THB
Freehold ownership for foreigners	Yes (condo, from 1st floor)	Yes (condo, from 1st floor)	Yes (condo, from 1st floor)	Yes (condo, freehold)
Transfer tax	4%	4%	4%	Approx. 6.3% (combined)
Secondary market liquidity	Moderate	Low to moderate	Low	High
Typical tenant profile	Expats, NGO workers	Middle class, Koreans	Young professionals	Expats, tourists
Minimum budget (studio)	$90,000	$55,000	$45,000	$120,000

Risks and mistakes

Liquidity is the primary challenge. The secondary market for condominiums in Phnom Penh remains thin. Selling a unit can take 6-18 months, and the achievable price is often 10-15% below initial expectations. Exit strategy must be defined before entry, not after.

Developer quality varies significantly. Cambodia has no equivalent of a state-backed developer guarantee fund. In the event of developer insolvency, instalments paid are at risk. The critical question is always: has this developer delivered previous projects on time and to specification? Independent verification on the ground is non-negotiable.

Oversupply in certain segments. Phnom Penh experienced an intense construction boom between 2018 and 2023. According to Knight Frank Cambodia data, vacancy rates in the luxury segment exceeded 30% in central areas at the end of 2024. The mid-range segment ($1,400-$2,000/sqm) is more fundamentally sound, but selectivity remains essential.

Tax obligations in your home country. Rental income earned in Cambodia is taxable in your country of residence. Many jurisdictions do not have a double taxation treaty with Cambodia. Investors may be able to offset Cambodian withholding tax against their domestic liability, but reporting obligations remain. Consulting a cross-border tax adviser before completing a purchase is strongly recommended.

Currency exposure is real, if atypical. USD-denominated transactions eliminate riel volatility, but investors whose base currency is not the dollar carry exposure to USD movements. Dollar-denominated cash flow can, however, serve as a natural hedge for those with USD liabilities or a preference for dollar-based savings.

No land ownership rights for foreigners. Foreign nationals cannot own land in Cambodia. Condominium hard title from the first floor upward is the only fully legal and straightforward ownership path. Alternatives such as 50-year leasehold arrangements or Cambodian company structures carry additional legal risk and require ongoing corporate maintenance.

FAQ

Can a foreign national own property outright in Phnom Penh?

Yes. Foreigners have the right to full freehold ownership (hard title) in a registered condominium building, but only from the first floor upward. Ground floor units and land are reserved for Cambodian citizens. The combined foreign ownership share in any single building cannot exceed 70%.

What does a Phnom Penh apartment cost in 2026?

Prices per sqm range from approximately $1,200 in the outer district of Chroy Changvar to $3,800 in the prestigious BKK1 area. A mid-range studio of 35-45 sqm typically costs between $55,000 and $85,000.

What are the ongoing ownership costs in Phnom Penh?

Common area maintenance fees typically run at $1.00-$2.00 per sqm per month. Annual property tax is 0.1% of assessed value. Professional rental management costs 10-15% of monthly rent. In aggregate, annual costs absorb roughly 25-35% of gross rental income.

Is rental income taxed in Cambodia?

Yes. For non-residents, a 10% withholding tax applies to rental income. Additional levies may apply depending on ownership structure and property classification. Investors should seek local tax advice specific to their situation.

How safe is Phnom Penh as an investment destination?

Cambodia has maintained political stability under single-party governance for several decades, which reduces the risk of abrupt regulatory reversals but limits institutional transparency. The legal system is younger and less predictable than that of Thailand. Using an independent Cambodian lawyer - separate from the developer's recommended counsel - is essential.

What does a realistic exit strategy look like?

The most viable options are: selling to another foreign buyer (requires patience and time), selling to a Cambodian national (often more straightforward if the price point matches local purchasing power), or holding the property long-term as a passive income asset. Planning for a quick resale at a premium is not realistic in this market.

Do I need to be a resident of Cambodia to purchase property there?

No. A tourist visa is sufficient to sign purchase documents. Property management can be fully delegated to a local management company. Remote ownership is common among international investors in this market.

How do I transfer funds to Cambodia to complete a purchase?

International SWIFT transfers in USD are the standard method. Most jurisdictions do not restrict outbound capital transfers, though banks typically require documentation of the source of funds and a copy of the purchase agreement. Using a provider with competitive USD conversion rates reduces unnecessary friction costs.

How does Phnom Penh compare to Bangkok as an investment?

Phnom Penh offers higher gross yields (7-9% versus Bangkok's 4-5%) and a lower entry price point, but comes with thinner secondary market liquidity and a less mature legal framework. Bangkok provides greater security, depth, and ease of exit. Phnom Penh suits investors who accept higher risk in exchange for a meaningfully higher income return.

Which districts in Phnom Penh offer the best risk-adjusted returns?

For income-focused investors, Toul Kork and Sen Sok offer the most attractive balance of yield and price. BKK1 and Tonle Bassac deliver better liquidity and tenant quality but at lower yields. Chroy Changvar is the lowest-cost entry point but carries the highest liquidity risk.

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