THE writing is on the wall for all real estate companies and agents in PNG.
With your gullibility, naivety and favouritism of the “sellers’ market”, you are chasing the prospects of the LNG projects away with your high rental and sale prices, and further disadvantage hard-working Papua New Guineans, who only want affordable housing in their lifetime.
The PNG real estate market, especially in Port Moresby, is small industry.
With the prospects of LNG, this has exacerbated property prices when there is no regulatory body to prudently manage these prices.
On an international level, these “astronomical” prices are associated with a country that has no administration in place to manage and minimise the negative outcome.
Usually, developed country will take advantage of this as can be seen in Central and South America by North America and north Africa by European countries.
I would like to pose two questions here:
1. Why would you buy property in PNG when you can buy an equitable property or two, at the same price, given the foreign exchange rate of the day, in either Australia, other Pacific countries or New Zealand?; and
2. Is Cairns the new hub of the PNG LNG project?
With the first question, you are looking at residential property prices of around K10 million at Boroko or rental prices of K5,000 per week at Korobosea.
How do real estate/property companies and agents justify these ludicrous prices when the average Papua New Guinean family living in PNG, can only afford, on average, property prices of less than K500,000 or rental prices of K600 per week?
These real estate/property companies and agents’ reasoning behind these prices is “the positive aspects of the LNG project”.
If that is the case, then it is also the negative aspect.
The same property prices in PNG today could be further gauged, that given the policies of property ownership in countries like Australia, one can buy an equally prospective property in an equitable neighbourhood, for a lesser price, and receive the equitable return over time.
If you don’t believe me, do your own calculations by comparing residential properties as investments between PNG, Australia and New Zealand.
This leads to the second question.
The cheapest and nearest place to PNG where the rental/sale prices are concerned is Cairns.
This has led to many families living in Cairns where they can fly in and out of PNG.
Why buy a property for K10 million or pay K5,000 a week in PNG when you can pay peanuts in Cairns?
To add more fuel to the fire, the media has reported that Qantas is increasing its Cairns-POM sector by up to 15 flights a week.
This will not only lower the airfare but allow the corporate management personnel with families, who want them close, but not at the expense of paying astronomical prices in an “unsafe haven” like Port Moresby or elsewhere in PNG.
The writing is clearly on the wall for all real estate companies and agents in PNG.
Current property/rental prices is pushing the demand market to Cairns and with the increase in flights, Cairns looks set to be the new hub of PNG’s LNG project.
And all this is thanks to PNG’s real estate companies and agents.
PNG property mourner