MoU to end speculation in local real estate sector
REAL estate appraisal services in Cambodia are expected to become better and more professional next year following the recent signing of a memorandum of understanding (MoU) by 32 licensed companies hoping to enhance law enforcement in the sector, according to the Cambodian Valuers and Estate Agents Association (CVEA).
The move aims to curb speculation in property prices by unlicensed dealers.
Sorn Seap, president of CVEA, stated that valuation services are a vital component of the real estate sector during a meeting of the organisation’s Real Estate Appraisal Working Group on November 23.
He noted that every transaction involving buying, selling, renting or mortgaging properties necessitates accurate evaluation.
He said the recent MoU between the companies, all members of the CVEA, is crucial for implementing standards in line with directives from the Ministry of Economy and Finance.
“Through the MoU and the commitment of all CVEA member companies, we hope that from the beginning of 2024 onwards, real estate appraisals in Cambodia will be conducted according to a common standard, with official reports, professionalism and high responsibility,” he stated.
He added that when assessments are conducted by experts that are internationally recognised, it helps attract foreign investment.
According to Seap, because the country is a member of the ASEAN Valuers Association (AVA), those in the industry are able to become members of the group as well.
Seng Sopheak, executive vice president and chairman of the CVEA Assessment Committee, stated that despite the prakas from the finance ministry having been in place since 2017, its practical implementation has not been effective so far.
He expressed concern that evaluations conducted by untrained and unprofessional individuals not only erode client trust and waste money, but also damage investor confidence and create disorder in the sector as a whole.
“Through this MoU, we will endeavour to bolster the effective implementation of the finance ministry’s prakas and advance the real estate appraisal sector abroad,” he stated.
Sopheak mentioned that the cost of valuation services in the country is set at $170 or more per case.
On July 31, 2017, the ministry issued Prakas 760, regarding the profession code of ethics for appraisers, and Prakas 761, which addresses fee and commission structures for their services. Both are designed to ensure effective management, control and collection of compensations.
status by 2030. Cambodia remains committed to making reforms and diversifying the economy in a global context.
Yang Peou, secretary-general of the Royal Academy of Cambodia (RAC), said that in general, when a government places value on scientific research for the introduction of policies and strategies, it will formulate correct policies and reduce any shortcomings. Research is the backbone that leads to development, and without it, development would be slow and disorderly.
He added that for example, RAC often conducts research and seeks input from government officials.
“The CDRI has been a government partner for a long time, ever since the RAC was established. The CDRI has played a key research role for the government for a long time, and become a regular government partner,” he continued.
Pa Chanroeun, president of the Cambodian Institute for Democracy (CID), believed that it was necessary for the government to collect input from actors from civil society organisations, public research institutions and the private sector in order to ensure the development of effective strategies.
Research also helps to monitor the implementation of government’s policies and assess their effectiveness.
“These tasks require the participation of a research institute and think tank, whether the CDRI or other state and private institutions, or independent institutions. In this way, the input into policies and strategies is collected in a scientific and comprehensive way,” he added.