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Though the official campaigning period is only in its early stages and the election a month away, there is little doubt that the Cambodia People's Party will hold onto power when the votes are counted in the Cambodia general election. In fact, it is widely expected that the CPP, led by current Prime Minister Hun Sen, will, for the first time gain enough seats in the assembly to rule on their own.

This is not great news for the property market, Hun Sen has remained reluctant to allow foreigners to purchase property, which is against the Cambodian constitution, but has been a massive hindrance to the Cambodian property market reaching its full potential. But an even bigger problem is the lagging implementation of a sub-decree to regulate and safeguard the current leasehold system.

Currently the best option for foreigners to buy Cambodia property is to do so on a 99 year leasehold tenure, which some experts say is effectually ownership of the property anyway, but currently the system is based largely on trust with the only contract being between the owner and the leaser. Most people would like to see government guarantees on the 99 year leasehold, and while a decree has been passed that would allow this it has been slow taking effect.

Matthew Rendall, a partner at the law firm Sciaroni & Associates said:

"People want an instrument issued by the government. Even though the sub decree has been passed, the implementation is lagging. In order to attract foreign ownership, you need a strong system and a reliable guarantee mechanism for the regulation of leases." Rendall also said that all over the world, if you have more than a 40 year lease, you are considered to, in effect, own the property.

Liam Bailey head of international research said:

"I honestly thought Cambodia would have made some moves by now to further attract foreign investment to fully capitalise on its growth potential, but it seems that the fact that Cambodia was doing fine in its current state seems to have prevented this. However, there is the possibility that property prices in Phnom Penh, Cambodia's main growth centre may start to level out in 9-12 months, and the run of Cambodian exiles investing in property may run out, the government may be forced to become more receptive to foreign investment - here's hoping! The ironic thing is that a quick move by the government to allow foreigners to buy land for off-plan development may well give Phnom Penh a whole new lease of property price growth life."

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