Need advice on buying Borey unit in Cambodia
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Need advice on buying Borey unit in Cambodia
Hi, I’m looking for some advice on the pros and cons of buying a “Borei” unit. It would be in my long-term girlfriend’s name. (Can I respectfully ask that replies could be kept to the topic at hand – as opposed the wisdom of shopping for property on behalf of Cambodian partners?. We’ve been living together for 15 years, I know the family, etc.. That’s simply a different topic.)
My priority isn’t making a fortune on an investment; (and I’m not really concerned about investing here vs the West or another country; the possibility of buying at home is a sad joke.) My goal is to stop paying rent and to put that money into something we can call our own. A Borei is tempting because the process is apparently simple (the down payments I have been shown are low enough that I could use savings to pay for it in one go, not have to borrow money, and then just move straight in and pay it off monthly), as opposed to having to negotiate a bank loan as a foreigner (though I admit I have not really investigated this and don’t know how hard it would be). I am not remotely wealthy. I have an OK income for the time being, but am not getting any younger and feel we need to own something here.
A number of Borei developments have sprung up on the edges of the provincial capital I live in. They vary in price.. I’ve been renting a quite nice house for three years; it’s not cheap but worth it to me for various reasons. However, I feel like I’m half way to having bought the place for my landlady by now (she told me she took a five-year bank loan to build the place) and that’s starting to feel stupid. We have seen some high priced Borei units but I’m thinking a good place to start would be a lower priced place. There are reasonable looking units going for $30,000 or $40,000 here that we could actually own in a reasonable amount of time.
Any thoughts on buying a Borei unit (again from the perspective of owning a roof over one’s head and ensuring my girlfriend has something should anything happen to me, rather than a killer investment prospect) welcome. Particularly in relation to:
- Hard vs soft title (are they usually one or the other?.. is the latter always to be avoided?) Hard title is a “gondah” from the “Krasuang”, correct? I was shown some farmland a while ago; the guy told me the “gondah” came from the “koum” which I assume is soft title?
- Any tips on “red flags” to look for when actually looking at a unit, in terms of construction quality?
- If we do need to sell, any ideas of resale, rentability of such units? Do the companies themselves buy back such units or do you have to put it on the market and sell it yourself?
- Property tax? Is there such a thing?
- Are there “rules” for the owners to follow… ie, my next door neighbor can’t open an all night Karaoke lounge in his home, etc?
- If I decide to buy a non Borei property I’d need a bank loan .Do banks here lend to foreigners to buy homes? I have work permit and a sole proprietorship.
A final thought; Borei projects are relatively new here, but I’ve noticed in Thailand that some seem worthy, others look great at first but you see them five years later and they’re run down, roadways, common areas not maintained, etc.
Sorry I’ve gone on a bit long here. Thanks in advance for any thoughts…
My priority isn’t making a fortune on an investment; (and I’m not really concerned about investing here vs the West or another country; the possibility of buying at home is a sad joke.) My goal is to stop paying rent and to put that money into something we can call our own. A Borei is tempting because the process is apparently simple (the down payments I have been shown are low enough that I could use savings to pay for it in one go, not have to borrow money, and then just move straight in and pay it off monthly), as opposed to having to negotiate a bank loan as a foreigner (though I admit I have not really investigated this and don’t know how hard it would be). I am not remotely wealthy. I have an OK income for the time being, but am not getting any younger and feel we need to own something here.
A number of Borei developments have sprung up on the edges of the provincial capital I live in. They vary in price.. I’ve been renting a quite nice house for three years; it’s not cheap but worth it to me for various reasons. However, I feel like I’m half way to having bought the place for my landlady by now (she told me she took a five-year bank loan to build the place) and that’s starting to feel stupid. We have seen some high priced Borei units but I’m thinking a good place to start would be a lower priced place. There are reasonable looking units going for $30,000 or $40,000 here that we could actually own in a reasonable amount of time.
Any thoughts on buying a Borei unit (again from the perspective of owning a roof over one’s head and ensuring my girlfriend has something should anything happen to me, rather than a killer investment prospect) welcome. Particularly in relation to:
- Hard vs soft title (are they usually one or the other?.. is the latter always to be avoided?) Hard title is a “gondah” from the “Krasuang”, correct? I was shown some farmland a while ago; the guy told me the “gondah” came from the “koum” which I assume is soft title?
- Any tips on “red flags” to look for when actually looking at a unit, in terms of construction quality?
- If we do need to sell, any ideas of resale, rentability of such units? Do the companies themselves buy back such units or do you have to put it on the market and sell it yourself?
- Property tax? Is there such a thing?
- Are there “rules” for the owners to follow… ie, my next door neighbor can’t open an all night Karaoke lounge in his home, etc?
- If I decide to buy a non Borei property I’d need a bank loan .Do banks here lend to foreigners to buy homes? I have work permit and a sole proprietorship.
A final thought; Borei projects are relatively new here, but I’ve noticed in Thailand that some seem worthy, others look great at first but you see them five years later and they’re run down, roadways, common areas not maintained, etc.
Sorry I’ve gone on a bit long here. Thanks in advance for any thoughts…
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Re: Need advice on buying Borei unit
- Only buy a house with a hard title.
- Don't buy house with a flat roof. Most boreys are low quality and flat roofs are sure thing to start leak within a year or two after completion. Heck even pitched roofs have problems here.
- Preferably buy only from a big borey developer who has build multiple projects. Go and look their old projects.
- Buy only house that is completed already. Don't buy off plan unless developer is one of the big ones (Peng Huoth, Chip Mong...).
- Stamp duty and VAT might be added to the list price. Sometime both might be included in price already. Check this! Stamp duty is 4% and VAT 10%.
- Property tax is a thing if your propety value is more than $25000. If I remember right currently its 0,1% of the value of the property annually.
- Your neighbour will have a karaoke every night and morning if he wants. Though in my experience the more expensive borey = less karaoke singing.
- Check if the borey has any monthly management fees. Also check how are utilities charged. Are you paying directly to utility company or via borey management company. The electricity and water price might be higher if not paying directly to utility company. Same with internet.
- Resales and renting it out depends totally on the location. Most likely not that easy to sell as they keep building new boreys all the time.
- Don't buy house with a flat roof. Most boreys are low quality and flat roofs are sure thing to start leak within a year or two after completion. Heck even pitched roofs have problems here.
- Preferably buy only from a big borey developer who has build multiple projects. Go and look their old projects.
- Buy only house that is completed already. Don't buy off plan unless developer is one of the big ones (Peng Huoth, Chip Mong...).
- Stamp duty and VAT might be added to the list price. Sometime both might be included in price already. Check this! Stamp duty is 4% and VAT 10%.
- Property tax is a thing if your propety value is more than $25000. If I remember right currently its 0,1% of the value of the property annually.
- Your neighbour will have a karaoke every night and morning if he wants. Though in my experience the more expensive borey = less karaoke singing.
- Check if the borey has any monthly management fees. Also check how are utilities charged. Are you paying directly to utility company or via borey management company. The electricity and water price might be higher if not paying directly to utility company. Same with internet.
- Resales and renting it out depends totally on the location. Most likely not that easy to sell as they keep building new boreys all the time.
Re: Need advice on buying Borei unit
Go with the borey.. buying land and building is expensive as heck... As for the title definitely make sure its hard and its transferred when all paid for. The need faith in the company but if it makes you fell better other khmers will be in the same boat.
Delays and budget overrun when building from my experience... Materials exp as heck with inflation... Reflecting back, i should have purchased a borey unfortunately no time machine so i guess u live n learn.
Good lcuk
Delays and budget overrun when building from my experience... Materials exp as heck with inflation... Reflecting back, i should have purchased a borey unfortunately no time machine so i guess u live n learn.
Good lcuk
Re: Need advice on buying Borei unit
@rogerrabbit has said pretty much exactly what I was going to.
Reference the hard title, many borey developments don't actually subdivide the land and get the individual hard titles for each plot until the development is completed, which can be risky. Also note that if you purchase it on a payment plan, you won't get the hard title until you've paid it off.
Speaking of payment plan, although many developers make it sound as if you are paying off the developer directly, it is actually in most cases through a bank and you need to go through the usual mortgage application process.
Most Cambodian banks will not give loans/mortgages to foreigners, those that do require collateral that is of equal or greater value to the loan (incl. interest), generally that means you need property as collateral, and it must be hard titled property (the bank holds the hard title until mortgage is paid off) you also need a local guarantor. If your wife works and has regular income she may be able to get a loan with your salary taken into account.
Most Borey developments do have a set of rules that people living in the development must follow, things like loud music included, but rarely enforced.
My wife and I viewed dozens of borey developments when house hunting, the construction quality was shit, they put these things up so fast that there is no care and no attention to detail, and this includes the big name developers...I personally would never buy one. Like Roger said, avoid flat roofs, so many peoples boreys are experiencing leaky roofs.
Reference the hard title, many borey developments don't actually subdivide the land and get the individual hard titles for each plot until the development is completed, which can be risky. Also note that if you purchase it on a payment plan, you won't get the hard title until you've paid it off.
Speaking of payment plan, although many developers make it sound as if you are paying off the developer directly, it is actually in most cases through a bank and you need to go through the usual mortgage application process.
Most Cambodian banks will not give loans/mortgages to foreigners, those that do require collateral that is of equal or greater value to the loan (incl. interest), generally that means you need property as collateral, and it must be hard titled property (the bank holds the hard title until mortgage is paid off) you also need a local guarantor. If your wife works and has regular income she may be able to get a loan with your salary taken into account.
Most Borey developments do have a set of rules that people living in the development must follow, things like loud music included, but rarely enforced.
My wife and I viewed dozens of borey developments when house hunting, the construction quality was shit, they put these things up so fast that there is no care and no attention to detail, and this includes the big name developers...I personally would never buy one. Like Roger said, avoid flat roofs, so many peoples boreys are experiencing leaky roofs.
Last edited by PSD-Kiwi on Sat Jul 02, 2022 2:32 pm, edited 1 time in total.
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Re: Need advice on buying Borei unit
Thanks for this feedback... really useful... cheersrogerrabbit wrote: ↑Sat Jul 02, 2022 1:30 pm - Only buy a house with a hard title.
- Don't buy house with a flat roof. Most boreys are low quality and flat roofs are sure thing to start leak within a year or two after completion. Heck even pitched roofs have problems here.
- Preferably buy only from a big borey developer who has build multiple projects. Go and look their old projects.
- Buy only house that is completed already. Don't buy off plan unless developer is one of the big ones (Peng Huoth, Chip Mong...).
- Stamp duty and VAT might be added to the list price. Sometime both might be included in price already. Check this! Stamp duty is 4% and VAT 10%.
- Property tax is a thing if your propety value is more than $25000. If I remember right currently its 0,1% of the value of the property annually.
- Your neighbour will have a karaoke every night and morning if he wants. Though in my experience the more expensive borey = less karaoke singing.
- Check if the borey has any monthly management fees. Also check how are utilities charged. Are you paying directly to utility company or via borey management company. The electricity and water price might be higher if not paying directly to utility company. Same with internet.
- Resales and renting it out depends totally on the location. Most likely not that easy to sell as they keep building new boreys all the time.
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Re: Need advice on buying Borei unit
Much appreciated - thanks!Jcml19 wrote: ↑Sat Jul 02, 2022 1:46 pm Go with the borey.. buying land and building is expensive as heck... As for the title definitely make sure its hard and its transferred when all paid for. The need faith in the company but if it makes you fell better other khmers will be in the same boat.
Delays and budget overrun when building from my experience... Materials exp as heck with inflation... Reflecting back, i should have purchased a borey unfortunately no time machine so i guess u live n learn.
Good lcuk
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Re: Need advice on buying Borei unit
Thanks much for this - yeah quality is a concern and that leaky roof thing seems universal, including my current rental. CheersPSD-Kiwi wrote: ↑Sat Jul 02, 2022 1:48 pm @rogerrabbit has said pretty much exactly what I was going to.
Reference the hard title, many borey developments don't actually subdivide the land and get the individual hard titles for each plot until the development is completed, which can be risky. Also note that if you purchase it on a payment plan, you won't get the hard title until you've paid it off.
Speaking of payment plan, although many developers make it sound as if you are paying off the developer directly, it is actually through a bank and you need to go through the usual mortgage application process.
Most Cambodian banks will not give loans/mortgages to foreigners, those that do require collateral that is of equal or greater value to the loan (incl. interest), generally that means you need property as collateral, and it must be hard titled property (the bank holds the hard title until mortgage is paid off) you also need a local guarantor. If your wife works and has regular income she may be able to get a loan with your salary taken into account.
Most Borey developments do have a set of rules that people living in the development must follow, things like loud music included, but rarely enforced.
My wife and I viewed dozens of borey developments when house hunting, the construction quality was shit, they put these things up so fast that there is no care and no attention to detail, and this includes the big name developers...I personally would never buy one. Like Roger said, avoid flat roofs, so many peoples boreys are experiencing leaky roofs.
- Freightdog
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Re: Need advice on buying Borei uni
I’ve little to add, but we looked at a couple.
One in particular stands out as it was torrential rain at the time. We couldn’t hold a conversation, it was that loud.
The flat roof concept was a big red flag. The water was not able to fully run off without a broom, and there was evidence that some rainwater was leaking back inside once the water got to a certain level. It was a new new build. I’d expect degraded crumbling walls within a short time.
I only went to look as the other half saw glossy artist impressions of how nice it was. I’ll not be looking again. I know the Khmer are very good at ignoring the incessant noise from just about everything, but I’m not.
Actually, I will add something.
I bought two pieces of land in our little section of the province. All in, about $10,000. The smaller piece is the same size as a piece of land the other half’s sister has, and she just had a place built for about $20,000. It’s shockingly designed, with a lot of wasted space.
With truck loads of soil/dirt brought in to raise the ground level , I think they have a very large house for around $25~30K.
With a brick outhouse.
One in particular stands out as it was torrential rain at the time. We couldn’t hold a conversation, it was that loud.
The flat roof concept was a big red flag. The water was not able to fully run off without a broom, and there was evidence that some rainwater was leaking back inside once the water got to a certain level. It was a new new build. I’d expect degraded crumbling walls within a short time.
I only went to look as the other half saw glossy artist impressions of how nice it was. I’ll not be looking again. I know the Khmer are very good at ignoring the incessant noise from just about everything, but I’m not.
Actually, I will add something.
I bought two pieces of land in our little section of the province. All in, about $10,000. The smaller piece is the same size as a piece of land the other half’s sister has, and she just had a place built for about $20,000. It’s shockingly designed, with a lot of wasted space.
With truck loads of soil/dirt brought in to raise the ground level , I think they have a very large house for around $25~30K.
With a brick outhouse.
Last edited by Freightdog on Sat Jul 02, 2022 2:55 pm, edited 1 time in total.
Re: Need advice on buying Borei unit
I know it sounds stupid, but what i did, and still do: buy something in your country, rent that-one out, and from that money your rent in Cambodia, useallly better numbers. I did buy an appartement is Spain (but i am not Spannish) and rent that, but its sounds strange, no ?? And ofcourse, its on your name and always will be, what is sometimes a important detail !!
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Re: Need advice on buying Borei uni
It costs about $8,000 to $10,000 to build a roof over the top of that flat roof, which then becomes a floor and gives you space for a play area for kids yourself or for hanging laundry. Also keeps the sun off the floor/roof. Well that's what I did with ours.Freightdog wrote: ↑Sat Jul 02, 2022 2:34 pm I’ve little to add, but we looked at a couple.
One in particular stands out as it was torrential rain at the time. We couldn’t hold a conversation, it was that loud.
The flat roof concept was a big red flag. The water was not able to fully run off without a broom, and there was evidence that some rainwater was leaking back inside once the water got to a certain level. It was a new new build. I’d expect degraded crumbling walls within a short time.
I only went to look as the other half saw glossy artist impressions of how nice it was. I’ll not be looking again. I know the Khmer are very good at ignoring the incessant noise from just about everything, but I’m not.
Actually, I will add something.
I bought two pieces of land in our little section of the province. All in, about $10,000. The smaller piece is the same size as a piece of land the other half’s sister has, and she just had a place built for about $20,000. It’s shockingly designed, with a lot of wasted space.
With truck loads of soil/dirt brought in to raise the ground level , I think they have a very large house for around $25~30K.
With a brick outhouse.
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