The world is changing. That is a fact. Actually, it has already changed. The pandemic has a significant influence on almost every aspect of our lives, and our everyday habits are totally different since the beginning of the year, when the disease began to spread around the world.
Let’s take a quick look at the last few months. Everything started in November 2019 in Wuhan, China. Of course, there’s a lot of doubts and speculations that the epidemic started earlier, but to be clear, we won’t be digging into speculations. In the beginning of this year the world was shocked hearing about thousands of casualties. In January, coronavirus SARS-CoV-2 was already present outside China. First, South Korea, many cases in Iran, and Italy, which became the second biggest centre of disease after Wuhan. The virus quickly appeared in the biggest European countries, where death toll is bigger than Wuhan’s. For now, the biggest amount of infected and dead is in the USA – over 1,2 million of confirmed cases. The USA and Europe are the centres of pandemic, when China has almost eradicated the coronavirus. For now, the total number of cases is greater than 3 million, almost 1 million cured and over 200 000 deaths.
The difference between the current outbreak and the previous ones, like SARS, Ebola or A/H1N1, is restrictive preventive measures. The warrant of wearing masks, restrictions of moving through and between cities and recommendations of staying at home became a kind of a fashion. For some communities, like celebrities and social media influencers, the whole situation became a lifestyle topic, tagged by already famous #stayathome hashtag. We get a lot of advices what to read, watch, how to train at home etc. But to be honest, this is a first world’s problem.
The real problem is in closing of many facilities, resources and lesser works, which have a critical impact for the worlds’ economy. Many companies have already closed, many people lost their jobs, and whole industries, like cultural facilities, hair and beauty, etc. are endangered by the current situation. We can already see what is happening on stock market, unstable prices of ores, oil and properties, or even cryptocurrencies. The pandemic is a threat to such big matters like presidential elections in Poland or USA, which are scheduled to take place this year. One thing is for sure. The crisis is coming…
So, what to do? How to prevent yourself from the economic instability that already came? Which areas of market are safe and which ones should be avoided if you want to make a smart investment in this hard time.
According to the French magazine L’Obs, 500 mln people in the world can fall into poverty because of the outbreak. Kenneth Rogoff, the professor of Harvard University said that the time, when the USA will return to 80% of their former condition is a “far dream”. We must expect the crisis of demand and supply. Even when the thing will come back to ‘normal’, it will take few years to convince the employers to start hiring people and investing, who will be bothered by tax burdens. This will be the price of financial supports from governments, as Rogoff explains. But the truth is that we need to wait for the definite eradication of Covid-19 to fully describe the state of global economy. Now, we can only forecast, but we must expect the biggest collapse since 1930’s, and the most optimistic scenario shows that a ‘partial recovery’ of economy is expected in next year. Printing more money, inflation and deflation may turn the current prices of goods upside down. People who lost their job already 2-4 months ago after some time can go on the streets, steal from shops just simply to survive. We can expect the quite post-apocalyptic scenario. Because we are facing an economical apocalypse right now.
So, what can you do to take care of your financial safety? Of course, invest! But what to invest in?
First, let’s summarize the most common investments, their advantages, disadvantages and the current condition of the market.
Gold, which is quite an obvious way of investment. It’s popular since centuries. Its value stays high in time of bear market and crisis, which is a pretty good investment which bought and sold in perfect time, can bring a really big profit. The good thing is that you will always find a buyer. Unlike the value of money, the price of gold is not endangered by inflation. It’s a good alternative for people who are afraid to keep their capital in banks, especially after 2008 crash.
The disadvantages are that in most cases you’ll need to wait for the perfect time. Good price of gold can be guaranteed by stable market, and this is what we are lacking right now. The current value is $1.700 for 1 ounce. In last months a lot of people bought a physical gold, so for now you can buy gold for a current price, but you need to wait for your delivery over a month, and during this time prices can change. However, the popularity of this way of investment is still high, but if you are planning to start this business right now it can be really difficult.
The other way of investments are cryptocurrencies. The first advantage is that you are not buying a physical product, which makes an access easier. The risk is its value differences. In February Bitcoin, the strongest cryptocurrency, was worth $10.000. After the outbreak it dropped down almost double. But from few weeks ago its value keeps growing. The current value surpassed $8.000, which is a good perspective. According to experts like Chamath Palihapitiya of Virgin Galactic, everyone should own some Bitcoins, because its value can reach even $1mln in the future. But even if it’s done by the specialists, it’s still a forecast. We can never be sure what can happen on the road to the million…
The last way of locating your capital are the properties and real estates of course. Because of the outbreak, the estate and hotel market is suffering. A lot of owners will decide to sell their properties with even 30% discount. There is a possibility to buy such property, wait a year, for example and then resell it with profit, of course. Or build your own estate or another object to rent and have a regular cashflow. This may seem to be risky, because we need to work with big amount of money. We also need to observe a lot of factors that have a huge influence on properties value. It’s the kind of property, the location and of course the economic potential of land, and what is most important now, the condition of the country, where we are buying our property. It’s really obvious that in the crisis, buying a property will be a huge risk, especially in countries where disease is spreading fast and shaking the whole economy. You need to find a buyer or a tenant to gain profit. The perfect timing is also important just like in gold or stock investments. Because of the outbreak, a lot of locations lost their values and potential. Buying properties in Central-Western Europe or the USA, where Covid-19 is spreading fast with casualties and crushing the economy may be risky.
Does it mean that property market is a ‘shoot in a foot’ now? Absolutely not! As we said, the success is in finding an offer in perfect time, and in perfect place. Even if the time is not so perfect, we have a perfect place. And this place is in the Kingdom of Cambodia. Why?
Cambodia is a country that is a unique example of fast developing and investor friendly market. From years it’s gaining an interest of foreign entrepreneurs from various kinds of industry. From constructors, to tech developers. What makes Cambodia so attractive?
First of all, the Kingdom is one of the few countries where coronavirus related data are so optimistic. For now, there are only 122 confirmed cases, 120 recovered and absolutely no death cases. This is a real sensation. Another country who has a similar outcome is Thailand. Of course, Cambodian industry also felt the impact of outbreak, this is actually unavoidable in current global situation. Difficulties in the country comes mostly from preventive measures.
But Cambodia has done a few steps that gave the respect from partner countries in this period. We must remember that it was Cambodia, which accepted The Westerdam cruise ship in their port, during the early days of outbreak. A lot of other countries didn’t give a shelter to passengers. Also, on February 5, the prime minister Hun Sen visited China, which was the only diplomatic visit in China since the beginning of pandemic. As a gesture of gratitude, president Xi Jinping encouraged Chinese investors to do business in Cambodia.
The Kingdom is an important partner of PRC. And we all realise how big deal the partnership with China is. It’s definitely the biggest player on the international arena. The greatest economic and technology tycoon in the world. Having such partner and neighbour gives a lot of support to develop own country. Chinese are fulfilling a lot of huge projects, i.e. Chinese investors are financing the construction of Morodok Techo National Stadium, new modern sport object near Phnom Penh which is set to host the 2023 Southeast Asia Games. This gives us the clear message that the first stadium in Cambodia, will bring a lot of tourists and many influential business and government people to the country. Cambodia really cares for good relations with Asian hegemon, and we can predict a stability for Cambodian business infrastructure. Despite the virus, the Kingdom declared also to keep stable relations and trading deals with other neighbour countries, Vietnam and Thailand. Our conclusion is that Cambodia is a perfect place, as we keep saying, the land of opportunities for wide range of investments. Entrepreneurs are mostly investing in tourism, resorts, and construction projects, and the last one means of course buying the land. And the land, or real estate market is pure gem on the business map of, not only Cambodia or even Asia, but the whole world!
What makes Cambodian lands so attractive? The whole country is now under interest of foreign businessmen. Starting from the capital city of Phnom Penh, which is extremely fast developing metropolis. Last year, over 1000 skyscrapers constructions have been started which makes it rather overcrowded place for newly minted property investors. Another location which is also considered attractive is Siem Reap. Popular and developed as well. However, Siem Reap is the most important touristic destination, mostly because of being an entrance to Angkor Wat. Because of Siem Reap’s touristic value, construction of high buildings is forbidden, which is also limiting investment opportunities. There is also Sihanoukville, which became extremely popular amongst Chinese newcomers. So popular, that for now the city is almost inaccessible for foreigners, or even Cambodians.
We are exploring the Kingdom for years. We’ve done a lot of research about business opportunities and land market, searching for this unique place that has the biggest potential to invest in. We didn’t expect that our discoveries would become so useful in time when the whole economy will be frightened by Covid-19. This discovery is a province of Mondulkiri, which is the best example of investment-friendly place.
The potential of Mondulkiri is being discovered by Cambodians themselves, so there are a lot of spaces for other people interested in land investments. Potentials of the province includes touristic destination – region is rich with natural habitat, green jungles, columns stones and animal sanctuaries, especially the famous elephant park. It’s also the ideal landscape for natural resources mining. Mondulkiri is rich in gold mines. In April, a new mine was discovered by the government.
What is most interesting for us, that Mondulkiri is full of unused land for sale, which is a great investment option, no matter what country you are from. And this is also a great way to provide a financial security in post-outbreak crisis.
Why? As we said, the potential of Mondulkiri is just being discovered, so the profits will be visible in few years, but at this time it could be too late to make a beneficial deal. Cambodia has already started two big projects in the province. One is the airport building project. The station will operate international and domestic flights, which means that in the future Kingdom will provide an easier connection for travellers. The second advantage for buying a land in that province is a $10 mln project for the biggest park in the centre of Mondulkiri, which is absolutely great news. The province has also new electricity network built last year. Mondulkiri is still being developed but looking at the development of other parts of the country we can be sure, that this province will also be the next important point on Southeast Asian map. Now there is a huge demand for construction objects like houses, offices, shops, storages, gyms and sport resorts, and of course hotels, bars and restaurants. The options are almost unlimited.
But how exactly the land prices look and what can we expect in this matter during the crisis? The prices of lands on suburbs has grown from $0,10-0,50 per 1m2 to $5-7 in last few years. In the centre of the province these prices grew from $5-20 to even $420 per 1m2. We are sure these prices will still be growing. Why? Let’s take a look at some facts: We discovered that prices have already grown by 100% since last year in some parts of the Kingdom. We are observing the amount of built resorts, and it also grew last year. Triply! We already told about Airport and Park projects. We know that such objects are increasing the attractivity and also enhance the price growth of a land.
The area is also surrounded by 4 national reservoirs i.e Phun Prech national wildlife sanctuary, which shows us the full variety of Mondulkiri attractions. As we also explained, Cambodia itself is one of the fastest developing countries in the world. We predict that the land prices can go up even by 1200$ – 1500$ in the next decade. This is an absolute phenomenon on the property market!
In other words, we highly recommend taking a look at Cambodian land offer if you are searching for safe and promising way to locate your capital. The province, as the whole country, is a fast-developing place. This development is not only barely impacted by the pandemic, but also is secured by the strong political and economic partnerships, with China in the first place. So, being a part of this landscape and become an investor in this land of opportunities is a really attractive option. Not only to secure your capital in new global crisis, but also to prepare the really awesome future for yourself. You can buy and sell land. But maybe you’ll decide to become the owner of luxury hotel or a fancy restaurant in the heart of Mondulkiri? Who knows?