English 
ភាសាខ្មែរ 
KEY TAKEAWAYS
- Property appraisal used to be done manually. Digital technology is now disrupting how it works; it assures a timely manner, convenience, transparency, and accuracy.
- Obtaining accurate property valuation by unbiased professional or independent experts plays a crucial role in the financial sector.
- 50% of the loan disbursement in the market is the credits that put up property title as collateral – land, and house in particular.
“In the past, property appraisal took up to three days to determine a property’s appraisal value. With the emerging digital technologies, it takes us only three hours to do so.”
From left to right. Mr. Vong Sokhal, Chairman of VTrust Appraisal Co., Ltd and Okhna Hout Ieng Tong, President, and CEO of Hattha Bank Plc, shook hands after the agreement was signed.
Real estate companies and bank have teamed up to digitalize property valuation in an effort toward digital transformation in Cambodia, envisaging adopting this technology to bring more benefits and create opportunities to the financial and real estate sectors.
VTrust Appraisal Co., Ltd and Hattha Bank Plc entered into a service agreement on Thursday 3rd February 2022 when Indication Plus Platform – a digital-based property valuation platform owned by VTrust Appraisal – was put in place for Hattha Bank. Zillennium Co., Ltd and Hattha Bank, on the same day, signed a Memorandum of Understanding seeking future cooperation. Zillennuim is serving beyond the real estate marketplace in Cambodia, it is a local conglomerate company, and Vtrust Appraisal is part of its business.
From left to right. Mr. Kuy Vat, Group Chairman of Zillennuim Co., Ltd, and Okhna Hout Ieng Tong exchanged the document after the MoU was signed.
The service agreement allows Indication Plus Platform, as the most reliable online property valuation service of Vtrust Appraisal, to play its role in Hattha Bank when it comes to mortgage application.
Mr. Vong Sokhal, Chairman of Vtrust Appraisal, said this partnership is an important step moving further for property valuation to be expandable in the country, increasing credit operation efficiency, especially for Hattha Bank.
“Indication Plus Platform is a digital-based property valuation. It is automatically analyzed and issued a summary form of a comprehensive real estate appraisal report from a reliable online system, calculated by experts and complies with the international professional standards,” he said.
Traditional manual valuations are subjective [valuer bias]. Some valuers may apply a more relaxed approach by validating a negotiated price rather than estimating the actual market value.
For VTrust Appraisal, it has been nearly 20 years providing the valuation service in the Kingdom. This experience has allowed the company to accumulate an extensive database of independent real estate transactions across the country.
“In the past, property appraisal took up to three days to determine a property’s appraisal value. With the emerging digital technologies, it takes us only three hours to do so,” said Mr. Sokhal. He went on to explain that the Indication Plus Platform allows users to access and submit reports anytime — conveniently, quickly, transparently, and accurately — while users can obtain property prices anywhere in the country,
According to industry insiders, obtaining accurate property valuation plays a crucial role in the financial sector, specifically regarding loan applications. Lenders want to ensure that homeowners are not overborrowing for a property because the home is collateral for the mortgage. If the borrower defaults on the mortgage and goes into foreclosure, the lender will sell the house to recoup its money. The appraisal helps the bank protect itself against lending more than it might be able to recover in this worst-case scenario.
Mortgages represent 50 percent of the total consumer outstanding loan balance from 2019 to the end third quarter of 2021. The total consumer outstanding loan balance, reported by Credit Bureau Cambodia (CBC), stood at $8billion in 2019, about $9billion recorded in 2020, and hits around $11billion by the end third quarter of 2021, respectively.
According to CBC, about 50 percent of the loan disbursement in the market is the credits that use property title as collateral. And most of the collaterals comprise house and land, between 150 000 to 200 000 transactions per month.
Okhna Hout Ieng Tong, President, and CEO of Hattha Bank Plc has acknowledged that this collaboration is a further step for his bank providing loans to consumers with high quality and efficiency.
“As we all have learned that when everything is systematically operated; of course, there will be a timely manner, accurate and reliable. With this platform [Indication Plus Platform], it will be beneficial to our bank operation,” he said.
Hattha Bank Plc has developed itself from a financial institution to one of the leading commercial banks in Cambodia. The bank has thus far operated 177 branches across the country, with its asset is currently standing at $2billion since its inception in 1994. And this signing ceremony will mark a milestone for the three companies to strive for their growth, part of the effort contributing to the development of financial and real estate in the Kingdom.
