By Mark Haihuie
PROPERTY prices are inflated because of the limited land available for development, according to the Real Estate Industry Association president Mike Quinn.
Quinn urged the Government to develop policies which would access more land for the real estate market.
“In Papua New Guinea, there is one very significant factor that continues to exert upward pressure on property prices – land availability,” he said.
“With 99 per cent of the PNG land mass held under traditional ownership, the ability to secure and develop land is stifled and creates inflated values on the alienated State leasehold land that is available with secure mortgagable tenure.
“There is now a relatively new land tenure module that potentially makes available traditional land for development without the landowners losing ownership of the land.
“We are hopeful that the Government will, in collaboration with a revitalised Lands Department, formulate new progressive policies, a cashed-up banking sector and an improving economy to lay the foundations for urban and rural development that will enable better use of under-utilised land resources.”
Quinn views the Government regulation of the market as worrying.
“That scenario is fraught with danger but more important is the fact that the market is, as it always does, adjusting as a result of the free market factors that are at play.
“The primary dynamics shaping our markets are availability of land for development, availability of developed properties, availability of funds for development, market size and demand, strength of the economy, costs of borrowing money and job security.
“These factors determine how the property market behaves and they are not always the same throughout the country.”
By Mark Haihuie