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Cambodia: Home loan application amounts over $5 billion despite Covid-19
The Covid-19 pandemic might have caused an economic downturn in Cambodia, but in real terms home loan applications are on the rise.
According to an annual report by the National Bank of Cambodia, home purchase credit in the country has increased by 37 percent in 2021, illustrating a sign of growing demands for home-ownership amongst Cambodians.
In 2021, total bank credit to consumers rose by 20 percent, which translates into $36.8 billion dollars in 1.2 million accounts. Of all loans applied by various economic sectors, home loans represent 13 percent – an increase of 37 percent each year.
Doeun Sopheap, Managing Director of Personal Credit Sales of J Trust Royal Bank, assured that banking and financial institutions are still growing steadily.
“In recent years, we have seen the growth of home loans provided by the banking institution to our customers,” he told Khmer Times.
Citing a report by the Credit Bureau of Cambodia, he added that there are now more than $5 billion in housing loans in Cambodia.
“The increase in the amount of housing loans in Cambodia could be due to various factors: the awareness in owning properties which led to banks giving out housing loans.
Also, the same awareness by the younger generation in investing on their own property and the importance of owning one’s own house.
“Some banks require a 30-percent deposit of the property price while some banks require a 20-percent deposit hence they must first have savings before getting loan approval from banks,” told Doeun Sopheap.
For the uninitiated, housing loans in Cambodia range between $150,000 to $300,000 per unit.
The President and Group Managing Director of ACLEDA Bank Plc., Dr. In Channy told Khmer Times that the number of housing loan applications by customers ending 2021 stood at 4,843, totalling $134 million.
In comparison with the same period in 2020, 5481 housing loan application were received, amounting to more than $135 million, which recorded a slight decrease in 2021 as the bank focused more on loans from SMEs and the corporate sector during that period.
Chrek Soknim, the president of the Cambodian Values and Estate Agents Association (CVEA) said that property in Cambodia can only be sold to Cambodian nationals.
“The Covid-19 crisis does not seem to affect the real estate business and there is still demand especially among the younger generation who seem to take advantage of the more lenient terms for housing loans,” he said.
Source: https://www.khmertimeskh.com/501018721/home-loan-application-amounts-over-5-billion-despite-covid-19/