Red Flags When Buying Property in Cambodia: How to Spot a Scam

TL;DR: The biggest red flags in Cambodia's property market are promises of 15–20% guaranteed returns, developers with no completed projects, leasehold schemes involving unknown local partners holding 51%, and false claims about citizenship-by-purchase. Real net yields range from 4–8% per year.

Why '15–20% Guaranteed Returns' Is a Red Flag

The most common hook used in Cambodia real estate scams is advertising "guaranteed profit of 15–20% per year." Experienced professionals on the ground call these numbers simply untrue.

Realistic market figures (2025–2026):

  • Annual capital appreciation: 6–7%
  • Net rental income after taxes and management: 4–5% per year
  • GRR (Guaranteed Rental Return) written into contract: up to 8% — the honest ceiling

If a seller quotes figures above 8% verbally without a contract to back it up, walk away.

Another common lie: "buy a condo and get citizenship." There is no citizenship-by-real-estate-investment program in Cambodia. This is a marketing fiction with no legal basis.

Developer With No Completed Projects: The Biggest Risk Signal

A developer offering an off-plan property with zero completed buildings in their portfolio is a serious warning sign. Post-COVID Sihanoukville showed exactly what happens: dozens of abandoned construction sites, frozen projects, and investors who lost everything.

How to vet a developer:

  1. Request addresses of at least 3–5 completed projects.
  2. Visit them in person, or ask a local contact to do so.
  3. Talk to actual residents — ask about management quality and build quality.
  4. Compare the originally promised handover date with the actual delivery date.

If the developer hesitates to share this information, that itself is your answer.

Leasehold With an Unknown Local Partner: A High-Risk Structure

Foreigners cannot own land in Cambodia directly. One workaround is registering the property under a Cambodian national (51%) with a notarized "transfer" of rights to the foreign buyer.

The risk is clear: the local partner is an individual whose intentions can change at any time. Courts will side with the person named on the title deed.

The safer alternative is a leasehold structure where the developer itself acts as the local partner — a registered legal entity. A 50+50 year lease agreement with a corporate entity offers far stronger legal protection than one with an individual you've met once. These structures exist, including in Siem Reap, starting from around $70,000.

How to Verify an Agent or Broker in 10 Minutes

A common confusion: an agent holding a developer's license is not the same as an agency employee. These are different legal statuses with different accountability.

Verification steps:

  • Agent claims to represent the developer → ask to see the developer's license.
  • Agent says they work for an agency → request documentation of employment or official partnership.
  • Email the agency's official address directly: "Does [name] work for you, and in what capacity?"

A key fact about pricing: buying directly from the developer is not cheaper than going through a broker. Developers maintain a fixed price list for all buyers. A broker, however, can arrange a free investment tour and manage due diligence — things a developer's sales team typically won't offer.

Quick Reference: Red Flag Checklist

Red Flag Why It's Dangerous
15–20% "guaranteed" returns Doesn't reflect the market; worthless without a contract
No completed projects from the developer High risk of construction freeze
Leasehold under an individual local partner (51%) No legal protection in a dispute
"Citizenship for buying an apartment" No such program exists
Sihanoukville property without freehold title Freehold is rare there — always verify
History of delays on prior projects High likelihood of recurrence

FAQ

Q: What is the realistic rental yield from Cambodia property? A: Net yield after taxes and management costs is 4–5% per year. GRR written into a contract can reach 8%. Numbers above this have no legal backing.

Q: Is there a citizenship-by-investment program through real estate in Cambodia? A: No. Cambodia does not offer direct citizenship in exchange for buying residential property. Any such claim is a sales tactic with no legal foundation.

Q: How many completed projects should a trustworthy developer have? A: At least 3, ideally 5–6. What matters is not just the number, but whether you can physically visit those buildings and speak with residents.

Q: Is it cheaper to buy directly from a developer than through a broker? A: The price is the same — developers use fixed price lists. Brokers add value through investment tours, transaction support, and market expertise that a developer's sales office doesn't provide.

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