Phnom Penh Rental Yield 2026: 7-9% Gross

A 45 sqm one-bedroom apartment in central Phnom Penh, purchased for USD 75,000, generates approximately USD 550 per month in rent. That translates to a gross yield of 8.8% - more than double what comparable units deliver in most Western European capitals. The Cambodian capital remains one of the last markets in Southeast Asia where entry prices are genuinely low and rental returns consistently exceed 7% gross. International investors, however, need the full picture: management costs, vacancy rates, taxes, currency exposure, and a realistic exit path. This article breaks down each element in detail.

Quick answer

Gross rental yield in BKK1 and Chamkarmon districts runs approximately 7-9% annually (market data, Q1 2026)
Entry price: a studio or one-bedroom in a new condominium ranges from USD 65,000 to USD 120,000; premium BKK1 stock reaches USD 3,000-3,500 per sqm
Monthly rent for a furnished one-bedroom: USD 450-700 (long-term), USD 35-65 per night (short-term)
Operating costs - management fees, sinking fund, rental income tax, insurance - absorb roughly 25-35% of gross income
Net yield after costs: a realistic 5-6.5%, still roughly double the return on investment-grade government bonds from many developed markets
Transaction currency: USD - Cambodia operates on a dollarised economy, removing local currency (KHR) risk, though investors holding other base currencies retain exchange-rate exposure

Options and scenarios

Scenario 1: Studio in Chamkarmon - long-term rental

You acquire a 35 sqm unit for USD 68,000 and lease it to an expat tenant at USD 480 per month on a 12-month contract.

The calculation chain:

Annual gross income: 480 x 12 = USD 5,760
Gross yield: 5,760 / 68,000 = 8.47%
Annual costs: management fee USD 480 + sinking fund USD 120 + rental income tax (10% of revenue) USD 576 + minor repairs USD 200 = USD 1,376
Net income: 5,760 - 1,376 = USD 4,384
Net yield: 6.45%

Assuming 11 months of occupancy (one month vacancy during tenant turnover), income drops to USD 5,280 and net yield falls to approximately 5.74%.

Scenario 2: One-bedroom in BKK1 - short-term rental

A 50 sqm unit purchased for USD 110,000, listed on short-term rental platforms at an average of USD 50 per night.

At 65% occupancy (237 nights per year) - a realistic benchmark for Phnom Penh:

Annual gross income: 237 x 50 = USD 11,850
Gross yield: 10.77%
Costs: management fee USD 480 + sinking fund USD 180 + short-term management (20% of revenue) USD 2,370 + rental tax USD 1,185 + cleaning, laundry, minor repairs USD 800 = USD 5,015
Net income: USD 6,835
Net yield: 6.21%

A key observation: the higher gross yield of short-term rental does not translate proportionally into net profit. Property management companies typically charge 15-25% of revenue for short-term operations, which erodes the premium significantly.

Scenario 3: Off-plan with a rental guarantee

A developer offers a unit at USD 85,000 with a guaranteed rental return of 8% gross for three years. It sounds attractive, but consider the following:

The guarantee is frequently priced into the purchase price; the same unit on the secondary market would likely cost USD 70,000-75,000
Once the guarantee period expires, market rent may run 15-25% below the promised figure
Developer insolvency risk is real - Cambodia lacks a robust buyer-protection mechanism equivalent to those found in more regulated markets
Realistic net yield after price adjustment and post-guarantee period: approximately 5.5-6% net

Comparison table

Parameter	Phnom Penh (long-term)	Phnom Penh (short-term)	Bangkok Condo (long-term)	Developed Market Bond (10Y)
Entry price (USD)	68,000	110,000	120,000+	From ~1,000
Gross yield	7-9%	9-11%	4-6%	3.0-4.5%
Net yield	5.5-6.5%	5.5-6.5%	3-4.5%	2.5-3.5%
Occupancy rate	90-95%	60-70%	90-95%	n/a
Management costs	5-8% of revenue	15-25% of revenue	5-10% of revenue	0%
Rental income tax	10%	10%	12.5% withholding	15-25% (varies)
Capital appreciation (YoY)	3-6%	3-6%	2-4%	0% (nominal)
Exit liquidity	Low to medium	Low to medium	Medium to high	Very high
Currency risk	USD vs. home currency	USD vs. home currency	USD vs. home currency	Minimal

How does Phnom Penh compare to Thailand?

For context, Phuket condominiums typically yield 5-7% gross, and Pattaya runs 6-8% gross. Phnom Penh beats both markets on entry price - the investment threshold is noticeably lower - but trails them on exit liquidity and the maturity of tourism infrastructure.

Risks and mistakes

1. Foreign ownership rules. Foreigners in Cambodia may purchase condominium units on the first floor and above (under 'strata title' ownership). Ground-floor units and land cannot be held directly without a Cambodian-registered corporate structure. Always verify the title type: a 'hard title' provides significantly stronger legal protection than a 'soft title'.

2. Developer risk. The Cambodian market does not have a statutory developer guarantee fund equivalent to those found in Thailand or many European markets. If an off-plan developer becomes insolvent, buyers risk losing all funds already transferred.

3. Rental guarantees. A guaranteed return of 8-10% gross is a warning signal when the prevailing market yield is 7-9%. The developer is effectively financing the difference from the inflated sale price. Once the guarantee expires, rent reverts to the market rate.

4. Potential double taxation. Cambodia and many investor home countries - including EU member states - do not have a bilateral double taxation agreement in place (as of 2026). Investors should seek independent tax advice to understand how rental income earned in Cambodia will be treated in their country of residence, as effective tax burdens can rise substantially.

5. Exit liquidity. The secondary market in Phnom Penh is thin. Selling a unit realistically takes 6-18 months. Resale value depends heavily on developer reputation and district. BKK1, Tonle Bassac, and Toul Kork offer the highest relative liquidity.

6. Currency exposure. While Cambodia transacts in USD, investors whose base currency is not the dollar carry USD exchange-rate risk. A 10% strengthening of the home currency against the USD reduces the USD-denominated return by a comparable amount when converted back.

7. Remote management. Phnom Penh sits in the UTC+7 time zone. There are no direct long-haul flights from most European or North American hubs; a connection through Bangkok, Dubai, or Doha adds 14-18 hours of total travel time. A professional, locally based property management company is an operational necessity, not an optional convenience.

FAQ

What is the realistic rental yield in Phnom Penh in 2026?

Gross yield for long-term rentals in BKK1, Chamkarmon, and Toul Kork runs approximately 7-9% annually. After management fees, taxes, and vacancy allowance, net yield realistically lands at 5-6.5%.

Can a foreigner buy a condominium in Cambodia?

Yes, provided the unit is on the first floor or above. Foreigners receive a 'strata title' deed. Purchasing ground-floor units or land directly requires a Cambodian corporate structure.

How much does an apartment in Phnom Penh cost in 2026?

A studio or one-bedroom in a new condominium typically costs USD 65,000-120,000. Premium stock in BKK1 reaches USD 3,000-3,500 per sqm. Secondary market units can be 10-20% cheaper than comparable new-build prices.

Are developer rental guarantees safe?

Not always. Guarantees of 8-10% gross are frequently funded by an inflated sale price rather than actual rental income. Once the guarantee period ends, rent drops to market levels. Cambodia has no statutory developer guarantee fund, meaning the buyer absorbs the full insolvency risk.

How is rental income from Cambodia taxed for international investors?

Cambodia levies a 10% withholding tax on rental revenue. Many investor home countries do not have a double taxation treaty with Cambodia, which can result in the income being taxable again at home. Investors should consult a qualified tax adviser familiar with both jurisdictions before committing.

Is short-term or long-term rental more profitable in Phnom Penh?

Short-term rental generates higher gross yields (9-11%), but management costs of 15-25% of revenue and lower occupancy (60-70%) close the gap significantly. Net yield in both models settles at a similar 5-6.5%. Long-term rental is considerably simpler to operate from abroad.

How quickly can you sell an apartment in Phnom Penh?

The secondary market is relatively thin. A realistic selling timeline is 6-18 months. Units in BKK1 and Tonle Bassac from reputable developers tend to sell fastest.

Is buying off-plan in Cambodia a good strategy?

Off-plan purchases can offer entry prices 10-30% below completed unit values. However, developer risk in Cambodia is substantially higher than in more regulated markets. Restrict your selection to developers with a proven track record of delivering completed projects.

In what currency are property transactions conducted in Cambodia?

Cambodia operates on a dollarised property market. Prices, rents, and fees are denominated in USD. This removes Cambodian riel (KHR) currency risk but leaves investors exposed to fluctuations between USD and their home currency.

What does property management cost in Phnom Penh?

For long-term rentals, management companies typically charge 5-8% of monthly revenue. Short-term rental management runs 15-25% of revenue. Add a sinking fund contribution of approximately USD 0.50-1 per sqm per month and building management fees of roughly USD 6-10 per sqm per year.

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Rental Yield in Phnom Penh: 7-9% Gross in 2026