The real estate market in Papua New Guinea (PNG) is expected to reach a value of US$75.21 billion by 2024, according to market forecasts by Statista, a global data and business intelligence platform.
Within this market, the residential real estate segment is projected to have a market volume of US$62.29 billion in 2024. This segment is anticipated to grow at an annual rate of 5.22% between 2024 and 2028, resulting in a market volume of US$92.20 billion by the end of that period.
The growth in PNG’s real estate market is closely tied to the country’s broader economic performance. The World Bank reports that PNG’s real GDP grew by 1.4% in 2023, primarily driven by the mining sector.
The growth rate is expected to increase to around 3.0% in 2024, due to the resumption of production at the Porgera gold mine and global economic resilience.
The resumption of the Porgera gold mine is expected to boost exports and foreign exchange reserves, contributing to Papua New Guinea’s economic growth and positively impacting the real estate market.
However, the end of the LNG project construction led to an oversupply of high-end properties and a shortage of affordable housing. New residential developments are emerging to meet the growing domestic demand driven by rising prosperity and home ownership aspirations, as the real estate market adjusts to the post-LNG phase.
In comparison, China is projected to generate the highest value in the global real estate market, with an estimated worth of US$135.70 trillion in 2024.
Nevertheless, PNG’s real estate market is also experiencing a surge in demand for luxury beachfront properties, driven by growing interest from international investors according to the report.
The government of PNG has also taken steps to address land ownership challenges, which have historically been a barrier to real estate development.
Oxford Business Group reports that approximately 97% of land in PNG is under customary ownership, with recorded land titles rarely existing.
The government of PNG aims to address this challenge through the National Land Development Program (NLDP) by facilitating the incorporation of customary land groups and voluntary customary land registration as reported by Business Advantage PNG.
The NLDP initiative could unlock the potential of PNG’s real estate market by addressing the supply-demand imbalance that has held the market back for years.
However, Oxford Business Group warns that customary land is considered too risky for most new commercially developed housing, which is typically built on alienated land.
