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Writer's picturePatrick Mooney

Land Titles in Cambodia: A Comprehensive Guide

Updated: Mar 15, 2023


A property title, also referred to as a 'deed,' is an official document that verifies the owner of a property, its location, and the rights that the owner has. In Cambodia, it's essential to note that a considerable percentage of land is unregistered and lacks an official land title certificate, which could potentially jeopardize the owner's rights.


Unfortunately, during the civil war between 1975 and 1979, all Cambodian land title records were destroyed. After the war, the government passed the 1992 Land Law to establish a framework for land ownership. However, it wasn't until 2001, when the law was revised, that Cambodia allowed private ownership of land. This revision led to the creation of a land registry system, which has issued over two million land titles to citizens.


In this blog we'll look at the three types of titles that potential investors should be aware of: Soft Titles, Hard Titles, and Strata Titles. All three titles are legal documents that establish ownership of land or property, but they differ in their level of security and the type of property they apply to.


Soft Titles:


Soft Titles, also known as Possessory Rights, are issued by local authorities to people who occupy or use the land but don't have a legal title to the property. Soft Titles are typically issued for properties that have been in use for generations and whose owners don't have the necessary paperwork to prove ownership. Soft Titles are valid for a renewable period of five years and can be transferred to another person.


One of the main issues with Soft Titles is that they are less secure than Hard Titles and Strata Titles. Soft Titles can be vulnerable to legal disputes and can be revoked if the land is needed for a public project, such as road construction.


Hard Titles:


Hard Titles are legal documents that prove ownership of the land or property. They are issued by the Ministry of Land Management, Urban Planning and Construction, and provide more security than Soft Titles. Hard Titles are registered with the government and are recognized as legal proof of ownership.


Hard Titles are more difficult to obtain than Soft Titles because they require a significant amount of paperwork and legal procedures. However, the effort is worth it as Hard Titles provide more security and offer protection against land disputes and other legal issues.


Strata Titles:


Strata titles in Cambodia have become increasingly popular and are considered a positive development in the country's real estate industry. The strata title system is a legal framework that allows for the division of a building or development into individual units, each of which can be owned separately. This is a departure from the traditional system in Cambodia, where ownership of a building or development was tied to the land it was built on.


The strata title system is particularly beneficial for foreign investors looking to purchase property in Cambodia. Under the old system, it was difficult for foreigners to obtain ownership of property in Cambodia, as the law required a foreign investor to have a Cambodian partner or to establish a Cambodian company to own the property. This was a significant barrier to investment for many foreigners. However, with the introduction of strata titles, foreigners can now own individual units within a development or building, making it easier and more straightforward for them to invest in the country's property market.


The strata title system also provides greater protection for foreign investors in Cambodia, as it establishes clear legal ownership of individual units, which can be used as collateral for financing or sold on the open market. Additionally, the system creates a more transparent and regulated property market, which is attractive to foreign investors who are looking for stable and secure investments.


Conclusion:


When investing in property in Cambodia, it's very important to understand the differences between titles. Soft Titles are less secure than Hard Titles and Strata Titles, while Strata Titles apply only to multi-unit properties. Hard Titles provide the most security and protection against legal disputes, but they are more difficult to obtain. Strata Titles offer an easier way to invest in multi-unit properties and provide a good investment opportunity. It's always a good idea to seek legal advice from a qualified lawyer to ensure that you understand the implications of your decision.

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