A study by the Papua New Guinea National Research Institute (PNG NRI) found that some real estate agents and landlords tend to fix property prices at the expense of buyers and tenants.
This argument is based on the factors they consider when determining the price of residential property being offered for sale or rent.
PNG NRI’s Research Fellow Thomas Wangi and Deputy Director for Research Associate Prof. Eugene Ezebilo, who did the study, pointed out that most real estate agents and landlords determine prices by considering what their colleagues have fixed.
One other point, but not the least, is the market forces of demand and supply.
To prevent such practice, in their paper titled Determinants of residential property prices as perceived by real estate agents and landlords in Port Moresby, the researchers recommend:
• The government to facilitate the private sector to construct more houses relative to demand – the greater supply of houses should reduce house prices;
• Activities of real estate agents and landlords should also be regulated; and,
• The government should facilitate the release of land, especially customary land with proper titles.
At the moment, some real estate agents and landlords appear to be manipulating prices by creating artificial demand to push up property prices for their own benefit, the report states.
The findings from this study aims to assist policy makers and planners develop strategy to address the housing affordability problems by considering the contribution of real estate agents and landlords in determining house and land prices.
Read the full paper on the PNG NRI website https://www.pngnri.org.
Also, follow discussions on this study on our social media pages:
Authorised for release by:
Dr. Osborne Sanida
PNG NRI Acting Director