Home loan demand rises to over $5 billion despite Covid-19

The Covid-19 pandemic may have caused an economic downturn in Cambodia, but in real terms mortgage applications are on the rise.

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According to an annual report by the National Bank of Cambodia, home purchase credit in the country grew by 37% in 2021, illustrating a sign of growing demand for home ownership among Cambodians.

In 2021, total bank credit to consumers grew by 20%, translating to $36.8 billion in 1.2 million accounts. Of all the loans granted by the various economic sectors, real estate loans represent 13%, an increase of 37% each year.

Doeun Sopheap, managing director of personal credit sales at J Trust Royal Bank, assured that banking and financial institutions continue to grow steadily.

“In recent years, we have seen the growth of home loans granted by the banking establishment to our customers,” he said. Khmer time.

Citing a Cambodia Credit Bureau report, he added that there were now more than $5 billion in housing loans in Cambodia.

“The increase in the amount of real estate loans in Cambodia could be due to several factors: the awareness of real estate ownership which led banks to provide real estate loans.

Also, the same awareness by the younger generation of investing in their own property and the importance of owning their own home.

“Some banks require 30% down payment of the property price while some banks require 20% down payment, so they must have savings first before getting loan approval from banks,” Doeun said. Sopheap.

For the uninitiated, housing loans in Cambodia range between $150,000 and $300,000 per unit.

ACLEDA Bank Plc. Group Chairman and Chief Executive Dr. In Channy said Khmer time that the number of home loan applications by customers at the end of 2021 was 4,843, totaling $134 million.

Compared to the same period in 2020, 5,481 home loan applications were received, amounting to more than $135 million, which saw a slight decline in 2021 as the bank focused more on SME lending. and the corporate sector during this period.

Chrek Soknim, president of the Cambodian Securities and Estate Agents Association (CVEA), said property in Cambodia can only be sold to Cambodian nationals.

“The Covid-19 crisis does not seem to be affecting the real estate sector and there is still demand especially among the younger generation who seem to be taking advantage of the more lenient terms of housing loans,” he said.

• Keywords: home loan, home ownership