Airbnb and Short-Term Rentals in a Cambodian Condominium

Prepared by the NovAsia Editorial Team

An apartment in Phnom Penh may achieve US$650 a month on a one-year tenancy. A similar unit on a short-stay platform may be advertised at US$55 a night. Multiplying that rate by 30 suggests monthly revenue above US$1,600 and makes short-term letting appear to be an obvious way to improve returns.

The owner is not, however, selling 30 identical nights. The business involves occupancy, check-in and check-out, cleaning, linen, platform fees, messages, deposits, damage, registration of foreign guests and the rules of the condominium. When vacancy is high, gross revenue can move surprisingly close to long-term rent while operating costs remain much higher.

The distinction is also regulatory. Letting one home under an ordinary tenancy and repeatedly supplying tourist accommodation are not necessarily treated as the same activity.

A registered private-unit title gives a foreign owner the right to use and dispose of the apartment within the law and the building's internal regulations. It does not automatically turn the unit into a licensed miniature hotel.

A platform is a sales channel, not a permit

Airbnb, Booking.com, Agoda and similar services connect hosts and guests. They may verify identity, payment methods, reviews and compliance with platform rules. Publishing a listing does not prove:

• that the required tourism licence exists;
• that the business or tax registration is correct;
• that the condominium has approved the operation;
• that fire-safety requirements are met;
• that foreign guests are lawfully registered;
• that the insurance covers the use;
• that a long-term tenant has permission to sublet.

The platform answers whether an advertisement can be placed. Government authorities and building rules answer whether the particular service may lawfully be operated from that apartment.

An active listing in the same building is not a legal opinion. The neighbour may be operating without approval, through a licensed operator or under a different arrangement.

The right to let a private unit has limits

Sub-Decree No. 126 recognises a private unit as separate property and permits it to be sold or rented within the law and the building's internal regulations.

Use of the apartment should not damage the structure, threaten safety, interfere with other owners' rights, breach house rules or change the authorised purpose of the property without the necessary approval.

Short-term letting typically increases:

• the number of unfamiliar visitors;
• demands on reception and security;
• access-card issuance;
• movement of luggage;
• cleaning turnover;
• noise risk;
• use of lifts, pools and other common areas.

The building therefore sees the activity not only as a private income stream but as a different operating pattern for shared property.

When ordinary letting starts to resemble tourist accommodation

Cambodia's Tourism Law regulates tourism activity and includes accommodation services within the sector overseen by the Ministry of Tourism. Standards, classifications and licensing details may be supplemented by subordinate rules and administrative practice.

There is no safe general assumption that a lease remains ordinary residential letting merely because it is small or involves one apartment. Relevant factual features may include:

• advertising to tourists;
• charging by the night or for very short stays;
• continuous guest turnover;
• organised check-in and check-out;
• cleaning between stays;
• linen and consumables;
• guest support;
• a reception function;
• management of several apartments;
• operation under one brand;
• additional hotel-like services.

The more of these characteristics are present, the harder it is to describe the arrangement as nothing more than a sequence of normal residential tenancies.

Before launching, the owner should confirm the applicable position with the Ministry of Tourism, the relevant municipal or provincial tourism department and a Cambodian adviser familiar with the actual unit and scale of operation.

A tourism licence may not be the only registration

Even where a tourism licence is obtained, other requirements may include:

• company or business registration;
• tax registration;
• patent tax where applicable;
• taxes connected with accommodation;
• building approval;
• fire and health requirements;
• local-authority permissions;
• foreign-guest registration;
• employment compliance;
• suitable insurance.

The precise list depends on the scale and the identity of the operator. A single owner and a company managing 50 units are not in the same operational position. It would be wrong to impose a full hotel checklist automatically on every isolated stay, but equally wrong to assume that a small operation is always exempt.

Building rules can stop the model before the state does

Even if government regulation allows the activity, the condominium's internal regulations may limit short stays.

Review:

• any minimum tenancy period;
• a prohibition on hotel use;
• guest-registration rules;
• subletting provisions;
• access-card procedures;
• occupancy limits;
• quiet hours;
• restrictions on business activity;
• common-area use;
• move-in or check-in charges;
• deposits and fines;
• owner responsibility for guests;
• operator-approval requirements.

A registered rule should be distinguished from an informal reception practice. “Airbnb is prohibited” should be supported by the building documents or a properly adopted resolution. “Everyone does it here” is equally weak evidence.

Rules may change after purchase through the applicable owner-voting process. An investor should therefore recognise the risk in a strategy that depends on continuing acceptance by neighbours and management.

Residential condominiums, serviced apartments and condominium-hotels are different products

A conventional residential condominium is designed primarily for owners and tenants. Serviced apartments usually have a single operator, reception, housekeeping and accommodation infrastructure. A condominium-hotel or rental-pool project is built around a hospitality system from the outset.

Operating Airbnb in an ordinary residential tower attempts to insert hotel-style turnover into a residential management structure. That may not be permitted and, even where it is permitted, it is not cost-free.

A nightly rate from professional serviced apartments should not be compared directly with an ordinary unit without adjusting for licences, staffing and operating costs.

Foreign guests need to be registered

Cambodia's General Department of Immigration operates the Foreigners Present in Cambodia System, commonly known as FPCS. The tourism framework also requires operators of tourist accommodation to maintain and report guest information as applicable.

A workable arrangement should identify:

• who holds the FPCS account;
• who enters the guest's details and when;
• which documents are collected;
• who stores passport information;
• how late-night arrivals are handled;
• who remains responsible when the function is outsourced;
• how personal data is protected.

The booking platform does not complete this obligation automatically. If a manager says that registration is included, the management agreement should state that responsibility expressly and provide an auditable record.

Owner and operator responsibilities must be explicit

A common structure is that the owner supplies the apartment, a local manager creates the listing, a cleaner meets the guest, reception issues a card, the platform receives payment and the manager transfers net proceeds to the owner. When a complaint or regulatory question arises, each participant may deny being the accommodation operator.

The agreement should identify:

• the factual and legal operator;
• the owner of the listing account;
• the contracting party with the guest;
• the holder of any licence;
• the taxpayer;
• the person responsible for FPCS;
• the payment recipient and deposit holder;
• the insured party;
• the person deciding damage claims;
• the emergency contact.

An owner may delegate operational work but should not leave legal responsibility undefined. If the manager relies on its own licence, confirm that it covers the address, branch and form of activity.

A long-term tenant cannot automatically list the apartment

Cambodia's Civil Code restricts assignment of tenancy rights and subletting without the landlord's consent, subject to the contract and any applicable exceptions. A residential lease should therefore deal expressly with:

• subletting rights;
• listings on accommodation platforms;
• permitted guests;
• maximum stay length;
• commercial use;
• key and card transfer;
• income from guest stays;
• compliance with building rules;
• consequences of breach;
• removal of listings after termination.

Permission to receive personal guests is not permission to run a continuous short-stay business. The owner should also control the right to use apartment photographs and require cancellation or transfer of future bookings when the tenancy ends.

The economics begin with occupancy, not the nightly rate

Suppose the advertised rate is US$55 and occupancy is 70%. Gross revenue over a 30-day month is approximately US$1,155.

From that amount the owner may need to deduct:

• platform commission;
• management commission;
• cleaning and laundry;
• utilities and internet;
• consumables;
• repairs and furniture wear;
• service charges;
• tax;
• refunds and blocked nights;
• guest damage;
• access or check-in charges.

Even when the guest separately pays a cleaning fee, the entire amount may not reach the owner. The platform or operator may retain part of it.

After expenses, the owner's return may be US$700–850 or less. A long-term tenant paying US$650 may cover some utilities and cause much less turnover.

Short-term letting only outperforms when demand, pricing and management are consistently strong.

Seasonality and major events distort forecasts

A high rate during a festival, conference or holiday is not an annual average. A realistic model should reflect high and low season, weekdays and weekends, monsoon periods, new hotel supply, listing rank, reviews, minimum stays and cancellation rules.

One poor review can reduce conversion. A new host without a track record may need introductory discounts. Forecasting should therefore be monthly and scenario-based rather than built around the best weekend of the year.

Identical units compete with each other

Large condominiums may contain dozens of near-identical studios. Guests choose according to price, reviews, floor, view, furniture, cancellation terms, response speed and cleaning fees.

Where one manager controls many units, the contract should explain how bookings are allocated, whether particular listings receive priority, how corporate enquiries are distributed and how conflicts are managed. Without such rules, the manager may direct guests to the unit generating the highest internal commission rather than the best outcome for each owner.

Frequent arrivals increase common-area costs

Constant guest turnover increases demands on lifts, reception, security, cards, corridors and amenities. The building may introduce registration, check-in, access-card or operator charges. The validity and approval process for those charges should be examined, but the underlying economic issue is real: permanent residents may object to subsidising a private hospitality business.

A well-run building measures the additional burden and allocates it transparently rather than responding only through emotion or an unexplained prohibition.

Insurance must match the actual use

A normal home or landlord policy may assume owner occupation or long-term residential letting. Repeated paid stays change the risk.

Check coverage for:

• short-term or commercial accommodation;
• guest injury;
• theft and intentional damage;
• contents and furniture;
• loss of income;
• blocked periods;
• cleaner or contractor liability;
• interaction with the building's master policy.

Platform host protection is not the same as a complete Cambodian insurance policy. It has limits, exclusions and a separate claims procedure. The owner should obtain the insurer's position in writing.

Tax treatment depends on what the operator actually does

Cambodia's tax system distinguishes between rental income and accommodation or hospitality activity. The correct treatment depends on the nature of the operation, the operator and taxpayer, and the taxes that apply.

The structure should answer:

• who receives the guest's money;
• who issues the receipt;
• who is identified as the seller on the platform;
• whether the tax base is gross or net;
• whether rental or accommodation tax treatment applies;
• who reports income for a foreign owner;
• whether the manager withholds tax;
• how often returns are filed.

The management agreement should provide copies of relevant filings and receipts. A line in an owner statement saying “tax deducted” does not prove that the amount was reported and paid correctly.

Rules may change after the apartment is bought

A building may allow nightly stays today and adopt a 30-day minimum later. That change can alter the investment case substantially.

Whether a restriction can be challenged depends on the original regulations, the voting threshold, private-unit rights, the approved use of the building, sales representations, the procedure followed and existing contracts.

A condominium-hotel with a contractually established rental system offers a different level of certainty from a normal residential tower where short stays are merely tolerated.

Selling an apartment with an operating short-stay business

Some purchasers value an Airbnb history. Others see additional risks:

• reviews belong to the host account rather than the apartment;
• the listing may not be transferable;
• the operator holds the licence;
• building rules may change;
• furniture may be heavily worn;
• taxes or complaints may remain unresolved;
• future bookings create obligations.

A sale should address the listings, reservations, payments, messages, cleaning, licences, guest records, deposits, taxes, insurance and access cards. The phrase “ready-made Airbnb business” is only credible when the operation can actually be transferred to the buyer.

When the short-term model is stronger

Short-term letting may be commercially sound when:

• the building expressly and validly permits it;
• the licensing route is confirmed;
• foreign-guest registration works;
• demand exists across the year;
• the operator is professional;
• the apartment stands out from competing units;
• insurance is appropriate;
• tax is modelled correctly;
• net income materially exceeds long-term rent.

Long-term letting is usually stronger when the rules are uncertain, identical listings are abundant, the owner is overseas, seasonality is high, hospitality costs are substantial, the operator controls all data or the net-income difference is small.

The most expensive analytical mistake is to treat gross nightly revenue as net yield.

What to verify before buying for Airbnb

Request:

• internal regulations and relevant owner resolutions;
• written confirmation from building management;
• the approved use of the building;
• advice from the relevant tourism authority;
• the operator's licence and registration;
• tax registration;
• the FPCS procedure;
• insurance;
• the management agreement;
• a specimen guest agreement;
• a complete fee schedule;
• occupancy and net owner statements;
• complaints and proposed rule changes.

If half the model depends on verbal assurances, the investment risk is high.

Conclusion

A foreign owner's right to rent a private apartment does not automatically authorise a tourist-accommodation business.

Cambodia's Tourism Law regulates accommodation services and gives the tourism authorities power over standards and licensing. FPCS creates a separate guest-registration obligation. Tax and insurance depend on the facts of the operation.

The condominium's internal regulations add another layer. Even a licensed operator cannot ignore the residential character of the building and the rights associated with common property.

Airbnb may produce higher revenue, but the meaningful comparison is net income after vacancy, cleaning, utilities, platform fees, management, tax and wear. A resilient strategy rests on a confirmed licensing route, written building permission, reliable guest registration, a transparent operator and suitable insurance.

This article is for general information and is not legal, tax, insurance or tourism-business advice. The permissions, FPCS process, tax treatment and insurance cover should be confirmed for the specific apartment and operator before launch.

Sources

1. Kingdom of Cambodia — Tourism Law, 10 June 2009.
2. General Department of Immigration — Foreigners Present in Cambodia System (FPCS).
3. Royal Government of Cambodia — Sub-Decree No. 126 on the Management and Use of Co-Owned Buildings.
4. JICA Legal and Judicial Development Project — Civil Code of Cambodia provisions on assignment of tenancy rights and subletting.
5. General Department of Taxation — rules concerning rental income and accommodation activity.
6. Kingdom of Cambodia — Law on Insurance, 2014.

Frequently asked

Can a foreign owner let a Cambodian apartment by the night?

Owning and letting a private unit does not automatically authorise hotel-style operation. The owner should check the building's internal regulations, tourism requirements, guest registration, tax and the authority of the actual operator.

Is a licence required for Airbnb in Cambodia?

Tourist accommodation services fall within regulated tourism activity. The position for one apartment should be confirmed with the competent tourism authority rather than inferred from the fact that an online listing can be published.

Who registers foreign guests?

The responsible person should be identified in the operator agreement. The booking platform does not automatically complete registration through Cambodia's foreigner-presence system.

Can a condominium prohibit short-term rentals?

Use of a private unit is subject to the building's internal regulations and the rights of other co-owners. The validity of a particular prohibition depends on the building documents, the authority adopting it and the procedure followed.

How does short-term letting differ from a normal tenancy?

Frequent guest turnover, public accommodation advertising, organised check-in, cleaning and guest services make the activity closer to hospitality and create different licensing, tax, insurance and building-management risks.