Published on and written by Cyril Jarnias
Long-term property leasing in Papua New Guinea resembles neither the European model nor the classic Australian model. It is an expensive market, marked by high informality, the weight of custom on land ownership, omnipresent security concerns, and a sometimes unclear legal framework. Any long-term setup requires careful preparation. Drawing on available data and local market studies, this article provides a practical guide to understanding where, how, and at what price to rent, while staying within the bounds of the law.
Understanding the Long-Term Rental Market
The Papua New Guinean real estate market is both dynamic and unbalanced. Its value was estimated between US$1.5 and 2 billion around 2023, with projections of US$3–4 billion in the near future. This growth is driven by urbanization, foreign investment, major projects linked to natural resources (mines, LNG), and the rise of tourism. However, supply does not meet the needs of all population segments.
This is the percentage of land owned by customary landowners, limiting the development of formal housing.
Real estate surveys show the residential market does not fully meet demand, especially for low and middle incomes. Approximately 70% of homeowners are actually households renting to others: renting is at the heart of urban housing. In this context, rent determination is essentially driven by supply and demand, due to the lack of a public regulatory mechanism.
Cities, Neighborhoods, and Types of Housing
The long-term rental market is highly concentrated in two cities: Port Moresby and Lae. Prices, types of offerings, and living conditions are quite different, even though the same pressures are found everywhere: high rents, security costs, and a strong informal sector presence.
Port Moresby, Expensive and Segmented Capital
Port Moresby is both the largest and most expensive city in the country. The estimated cost of living is around US$566 per month for a single person, US$1,365 for a family of four, excluding rent. Local incomes do not keep up: the median monthly salary after taxes is around US$214, making the market “very unaffordable” for more than half of surveyed residents.
For a tenant, rents are very high and the formal market is primarily aimed at expatriates and high-income earners. The most sought-after neighborhoods in the National Capital District (NCD) are Waigani, Boroko, Korobosea, East Boroko, downtown (“Town”), as well as the hillsides of Touaguba Hill and Paga Hill or the secure subdivisions near 6 Mile and 7 Mile.
Data from a major portal like Hausples.com.pg provides an overview of available properties in Port Moresby:
| Property Type | Number of Listings | Average Area | Typical Bedrooms | Median Parking |
|---|---|---|---|---|
| Apartments/Condos | 248 | 100 m² | 2–3 (3 common) | 2 |
| Houses | 39 | 104 m² | 3–4 (3 common) | 2 |
Apartments are concentrated in areas like Town, Ela Beach, and Boroko. Houses for rent are found more towards 7 Mile, 8 Mile, and Gordons. These are primarily mid to high-end properties, including security, generators, and water tanks, which partly justifies the rent levels.
Lae, Second City but Dynamic
Lae, the country’s second city with about 100,000 inhabitants, has living and housing costs slightly lower than Port Moresby, but remains expensive for local incomes. For a single person, daily living costs around US$548 monthly, US$1,323 for a family of four – still well above the local median salary (about US$211 per month).
The median monthly rent for a 40 m² one-bedroom apartment downtown is US$234.
Types of Housing Offered
The formal rental market in Papua New Guinea is structured around a few main categories:
| Housing Type | Practical Description |
|---|---|
| Apartments (flats/units) | Multi-story building housing, very popular with expatriates, often fully secured. |
| Serviced Apartments | High-end version: furnished, cleaning, pool, gym, shuttle, etc. |
| Townhouses | Row houses, typically two stories, sometimes with common areas. |
| Duplex | Building divided into two separate dwellings. |
| High-set Houses | Houses on stilts, very common, with space underneath (parking, storage). |
| Low-set Houses | Single-story houses, without stilts. |
| Compounds/Gated Communities | Secured enclosures hosting a mix of these property types, guarded 24/7. |
For foreigners, apartments and secure compounds often remain the norm due to security constraints. Local residents, or expatriates with tighter budgets, tend more towards standard houses or informal housing.
Informal vs. Formal: Two Parallel Markets
A strong feature of the country is the weight of the informal rental sector, both in “settlements” and in some planned subdivisions.
Studies conducted in Port Moresby and Lae show that about half of the inhabitants of these two cities live in informal neighborhoods. A significant portion of these dwellings is rented, under private agreements that largely escape formal law.
In this sector, one finds:
Informal housing supply in cities can take several forms. This includes individual rooms rented within a single family home, allowing for a division of existing space. There are also “backyard rentals,” small independent structures built in the garden or at the back of a main house, often on already built plots. Finally, it can be entire units, sometimes grouped, built on land governed by customary law or in unplanned settlements.
The characteristics of this sub-market are quite constant: absence of a written lease compliant with the law, no recourse to a lawyer or real estate agent, payments in cash or by direct deposit, moderate rents but with no real protection for tenant or landlord.
Research by the PNG National Research Institute in various settlements (6 Mile, 4 Mile, 2 Mile, Taurama Valley in Port Moresby; Bumbu, Kamkumung, Boundary Road in Lae) shows several trends:
| Indicators (Informal) | Observed Values (2015 – NRI studies) |
|---|---|
| Median Monthly Rent | About 700 Kina (≈ 180 USD) |
| Median Construction Cost of a House for Rent | About 40,000 Kina (≈ 10,000 USD) |
| Link Between Rent and Quality | No clear statistical relationship |
| Time Since First Rented | Sometimes over 10 years for some units |
This type of offering meets a reality: over 45% of the formal workforce can only find housing in this segment. For the local investor or homeowner, it is also an important complementary source of income, especially since the boom linked to the LNG project in the early 2010s, which drove rents up in urban areas.
For a foreign tenant or an expatriate employee, entering the informal rental market is strongly discouraged if one seeks legal security, a high level of service, and physical safety. However, understanding the existence of this market helps grasp the origin of pressures on rents in the formal sector.
Legal Framework: Leases, Rights, and Obligations
Despite the high informality, Papua New Guinea has a relatively structured legal framework for long-term leases. Three main texts apply: the Landlord and Tenant Act, the Landlord and Tenant (Miscellaneous Provisions) Act of 1975, and the Property Law Act of 1978.
Long-Term Leases: Form and Duration
As soon as a lease exceeds one year, it must absolutely be in writing. The law distinguishes short-term rentals (less than a year) and long-term leases, which can extend over several years. For the latter, conditions for rent review, early termination, or renewal are often specific and must be carefully negotiated.
A written lease should always specify at a minimum:
A complete and secure rental lease must absolutely include: the full identity and contact details of the landlord and tenant; the exact address of the rented property; the start and end date (for a fixed-term lease); the amount of rent, the payment period (most often monthly), the place or method of payment; the amount of the security deposit (often equivalent to one month’s rent) and the conditions for its refund; the allocation of expenses (electricity, water, security, maintenance of common areas, etc.); the responsibilities of each party for maintenance and repairs; the security rules, the presence or absence of a generator, water tanks, fences, guards; as well as the terms for early termination and notice periods.
In practice, two types of instruments are often used in the formal market:
– the Lease proper, a detailed legal document prepared by a lawyer, for which the tenant typically pays the drafting fees and stamp duty;
– the Tenancy Agreement, simpler, sometimes not considered a strictly legal document, frequently used for apartment or house rentals over shorter durations.
Tenants’ Rights
The texts governing leases establish several fundamental rights for tenants, whether on a one-year lease or a multi-year lease.
The tenant has the right to: a decent and habitable dwelling, peaceful enjoyment of the premises, repairs in case of damage not attributable to their fault, and a proper settlement of rental charges.
The tenant has the right to a decent and safe dwelling, with water and electricity. They are entitled to peaceful enjoyment of the property and protection of their privacy: the landlord cannot enter without reasonable notice (except in an emergency). The contract must be clear on the security deposit and any deductions must be justified. The tenant must be informed in a timely manner of rent increases and can challenge unfair deductions, increases, or terminations through mediation or the courts.
Tenant’s Obligations
The counterpart to these rights is a set of fairly standard obligations, but which are useful to recall since they are often included in leases:
– pay rent on the due date, usually at the beginning of the month and often in advance;
– keep the dwelling clean, inside and out, and avoid any accumulation of waste;
– promptly notify the landlord of any damage or malfunction requiring repair;
– not cause intentional or negligent damage, including through guests;
– respect the neighborhood (noise, disturbances, aggressive behavior);
– not use the premises for illegal purposes;
– not carry out structural modifications without the landlord’s written consent;
– not exceed the number of occupants specified in the contract.
Landlords’ Rights and Obligations
The landlord, for their part, has the right to collect the agreed rent, to demand compliance with the lease, and to initiate an eviction procedure in case of serious breach (non-payment, illegal activities, destruction, etc.), while respecting notice periods and legal procedures.
In exchange for access to the service, the user agrees to respect the following obligations.
Use the service only within the framework provided by its terms and for lawful purposes.
Provide accurate, complete, and up-to-date information during registration and use.
Maintain the confidentiality of login credentials and be responsible for any activity on the account.
Do not disrupt the service’s operation or attempt to access systems without authorization.
– deliver a property in good condition, compliant with health and safety standards;
– maintain major structures (roof, walls, electrical and plumbing installations, etc.);
– carry out major repairs within reasonable timeframes;
– respect the tenant’s privacy and give notice before visits (except in a real emergency);
– not cut off essential services (water, electricity) to pressure a tenant;
– formulate rent increases in a reasonable, justifiable, and predictable manner.
Security Deposit and Bond
In Papua New Guinea practice, a security deposit of one month’s rent is the norm for formal rentals. It must be paid before moving in and serves to cover:
– unpaid rent;
– outstanding bills or charges;
– damage beyond normal wear and tear.
If nothing is owed at the end of the lease, this amount must be refunded in full. In reality, again, the strength of the human relationship and the clarity of the condition reports determine how departures proceed.
Rent Costs: Price Benchmarks and Yields
One of the realities of the Papua New Guinea market is the high cost of formal rental, particularly in Port Moresby. Rents are very often advertised at a weekly rate, excluding the 10% Goods and Services Tax (GST), and then billed monthly.
For expatriates and companies, indicative ranges are often mentioned for the capital:
| Property Type (Port Moresby, International Segment) | Standard (PGK/week) | Premium (PGK/week) |
|---|---|---|
| 1-Bedroom Apartment | ≈ 1,000 | ≈ 2,500 |
| 2-Bedroom Apartment | ≈ 1,500 | ≈ 3,500 |
| 3-Bedroom Apartment | ≈ 2,000 | 4,500 and up |
| 2-Bedroom House | ≈ 2,000 | ≈ 3,000 |
| 3-Bedroom House | ≈ 3,000 | 4,000 and up |
These rents often include part of the security costs (guarding, fences, access control) and infrastructure (generators, water tanks, sometimes pool or gym access). They are exclusive of GST, which is generally added via the landlord’s or real estate agent’s billing.
For comparison, concrete examples from listings give an idea of the levels encountered.
– 6-bedroom house in the gated Skyview Estate (7 Mile, Port Moresby) at 2,300 Kina per week;
– 3-bedroom penthouse with city view at Ela Beach at 8,000 Kina per week;
– executive 2-bedroom apartment at Whittaker (Ela Beach) at 3,500 Kina per week;
– single 3-bedroom houses with office at Gordons at 1,500 Kina per week;
– modern units at Kennedy Estate (7 Mile) between 1,050 and 1,200 Kina per week.
The monthly rent of many high-end properties in Tashkent, in US dollars, making it a very expensive capital by regional standards.
From an investor’s perspective, these high rents do not necessarily translate into spectacular yields. Market studies note typical gross rental yields of only around 1.4% to 2.5%, particularly in central Port Moresby sectors where the price-to-rent ratio exceeds 40, and even near 68 outside the center. The cost of land, construction, security, and services absorbs a significant portion of the rental value.
House Hunting: Key Players and Channels
To rent a property long-term in Papua New Guinea, especially in the formal segment, a few key players and tools are essential.
The main portals and agencies mentioned include:
Main online platforms, agencies, and specialized management companies in the local real estate market.
Country’s main real estate portal. Offers several thousand real-time listings, virtual tours, price trends, and integrated messaging with agencies.
Includes Century 21 Siule Real Estate, Strickland Real Estate (SRE), Alpha Property Solutions, DAC Real Estate, Arthur Strachan Real Estate Agency, AAA Properties, Professionals Real Estate Group, and Ray White Real Estate (over 20 years of property management experience).
Pacific Palms Property, Raitpla Property Management (specialized subsidiary), VENTURE PNG PROPERTIES LIMITED (portfolio in several cities), MRL Property Services Limited (major asset manager), and SIA Property Solutions Ltd.
These players cover varied segments, from local “boutique” to large regional-scale groups, and generally offer:
Discover our complete range of services designed to optimize the management and value of your real estate assets.
Complete management including rent collection, repair follow-up, and tenant complaint handling.
Managing your property developments and renovations, from design to delivery.
Expert support for your investment decisions and property valuation strategies.
Integrated services: security, facility management, and coordination with your insurers.
For long-term rentals, using a reputable agency or manager helps secure the contract, clarify rights and obligations, and reduce the risk of unpleasant surprises. In a market where there is not yet a specific authority regulating real estate agents, the reputation and local roots of the intermediary matter greatly.
Security, Insurance, and Natural Hazards
Any long-term rental decision in Papua New Guinea must account for two very concrete aspects: personal security and natural hazards.
Day-to-Day Security
Major cities, and particularly Port Moresby, are classified as high risk for urban crime: theft, assaults, carjackings are regularly reported. This observation is found in many reports and is reflected in housing architecture: high fences, window grills, armed or unarmed guards, access controls, cameras, guard dogs.
A “standard” dwelling in the expatriate segment often includes:
– a solid perimeter fence;
– window bars and secure doors;
– one or more guards, sometimes 24/7;
– a generator to cope with power outages;
– a backup water tank.
For a long-term lease, it is crucial to examine the security measures in place in detail. Verify precisely what is included in the rent (such as guarding, generator maintenance, fuel) and what remains the tenant’s responsibility. These elements, while adding to the cost, are far from superfluous luxuries and represent essential aspects to consider.
Natural Hazards and Insurance
Papua New Guinea is located on a tectonic plate convergence zone (Pacific and Indo-Australian) and is exposed to earthquakes, volcanoes, tsunamis, cyclones, and storms. Home insurance is not just a banking formality; it is a real line of defense.
Several local insurers offer coverage for buildings and their contents, as well as specific guarantees for landlords: Inspac (PNG) Limited, Niugini Assurance, Tower Insurance, MAS, Trans Pacific Assurance Limited, among others. Policies can include:
Suitable insurance for a landlord should include several key coverages: building protection at replacement value, contents coverage at indemnity value (new value less depreciation), and an extension for loss of rents if the property becomes uninhabitable after a disaster. It should also cover the landlord’s public liability and include cover for intentional damage or theft by tenants. Finally, specific coverages for major natural hazards (earthquakes, eruptions, tsunamis, floods, cyclones) are recommended, although they often come with increased deductibles.
In areas known for strong winds (like some parts of Milne Bay), storm cover is often included without a surcharge, but with adapted deductibles. The flood risk is considered less critical by many insurers than in other countries, even though claims do occur.
For a long-term tenant, two approaches exist:
– verify that the landlord has properly insured the building and, where applicable, the items provided (furniture, appliances);
– take out insurance for personal belongings and, if a sub-lessor or owner-occupier, a “non-occupying owner” type coverage or equivalent.
Financial institutions generally require home insurance for properties financed by credit, which increases the coverage rate in the formal segment.
Rental Process: From Viewing to Moving In
In practice, renting for several years follows a path similar to what is known in Oceania or Europe, with a few specificities.
Search and Pre-selection
The first step is often done online (Hausples, agency websites) or via professional networks. Once listings are pre-selected, it is wise to:
– verify the exact location (proximity to CBD, workplace, schools, shops, transport);
– inquire about the neighborhood (crime rate, road quality, frequency of power and water cuts);
– compare asking rents with similar properties in the area, knowing that agents and landlords themselves base them on market comparisons, demand, and security.
Viewings are an opportunity to assess the property’s actual condition, equipment, construction quality, and gauge the relationship with the agent or landlord.
Negotiation and Lease Signing
Once the dwelling is chosen, the agent or landlord sends a draft lease. In the expatriate segment, this is almost always formalized by a lawyer, at a cost typically between 800 and 2,000 Kina, usually borne by the tenant or their employer. Stamp duty calculated on the total rent amount for the lease term is added.
Several points deserve particular attention during negotiation.
– lease duration and possibility of automatic renewal or renegotiation;
– terms for annual (or multi-year) rent review and the index or benchmark used;
– early termination conditions (by tenant and landlord): notice periods, possible penalties, relocation costs;
– precise responsibilities for routine vs major repairs;
– allocation of security costs (guarding, maintenance of security equipment, alarms);
– allocation of water, electricity, internet, generator fuel costs, etc.
For long-term leases, these clauses make the difference between a stable experience and an ongoing source of tension.
Condition Report, Bond, and Moving In
Before handing over keys, a detailed condition report, ideally with photos, documents the initial state of the dwelling. It should be signed by both parties and kept carefully. This helps reduce disputes upon departure, particularly regarding the infamous “damage beyond normal wear and tear.”
The bond generally corresponds to one month’s rent, paid in advance when renting.
Moving in finally involves setting up utilities:
– electricity via PNG Power, often with a prepaid Esi-Pay meter (credit purchase from 15 Kina in supermarkets or online);
– internet via major operators (Digicel, Telikom PNG, Bmobile), with monthly data plans around 150 Kina for 30 GB;
– bottled gas, with frequent refills around 126 Kina for 13 kg, typically renewed every 3–4 months on average;
– delivery of bottled water if one does not wish to consume tap water as is.
Long-Term and Renewal: Anticipating Changes
Signing a lease for several years in Papua New Guinea means entering a changing economic and political context. Housing prices are sensitive to macro factors (growth, mining and gas projects, construction costs, jobs, interest rates) and micro factors (dwelling size, building age, neighborhood quality, accessibility, view, presence of green spaces).
Studies on rent determination in Port Moresby highlight four main families of factors influencing prices:
The main elements that determine a property’s price, grouped into four key categories.
Population, average incomes, construction costs, land scarcity, and job market dynamism.
Living area, number of rooms, amenities, finish quality, and property age.
Distance to city center, proximity to schools, shops, public transport, and workplaces.
Security, noise levels, infrastructure quality, nearby green spaces, and the view offered.
For a long-term tenant, it is crucial to anticipate:
– probable rent increases at each renewal;
– potential works that could temporarily make the dwelling less comfortable (renovations, new constructions nearby);
– changes in neighborhood security or access (roads, transport).
Renewal agreements should be discussed at least one to three months before the lease ends, with an updated market analysis: comparing rents of similar properties on Hausples or via agents helps assess if the requested increase is reasonable.
Land, Long-Term, and Constraints for Foreigners
A final word on the land issue, as it strongly influences long-term rental prospects.
In Papua New Guinea, foreigners cannot directly own most land. They can, however, lease land or built properties on “alienated” land via long-term State Leases (up to 99 years for a State Lease). These leases are administered by the Department of Lands and Physical Planning and are based on a Torrens-type land title system.
For a housing tenant, this concretely means that:
The formal owner generally holds a legitimate title or State Lease to build and rent. In contrast, long-term rentals on unregistered customary land are legally more fragile, although very common in practice.
Recent public programs, notably the National Land Development Program, seek to facilitate the availability of customary land via leasing mechanisms to businesses and developers, to increase formal supply. Pilots have been announced in areas like Napa Napa near Port Moresby.
For now, however, anyone seeking to rent for several years is well advised to ensure the property is situated on clearly registered land (State Lease, freehold held by a citizen, or duly formalized customary land via an Incorporated Land Group), especially if it is a corporate lease or a long-term expatriation with family.
In Conclusion: A Realistic and Structured Approach
Renting a property long-term in Papua New Guinea requires more advanced preparation than in many other countries in the region. Between the dualism of customary land/alienated land, an expensive formal market geared towards high incomes, a huge informal sector, the centrality of security issues, and a legal framework that still has room for improvement, caution is essential.
The country presents an expanding real estate market, with increasingly structured professional operators. An ecosystem of local insurers, familiar with natural hazards, is present. Furthermore, much new data is available thanks to real estate portals and the work of the PNG National Research Institute.
For the prospective long-term tenant, whether an individual or company, a few principles guide a successful setup: thoroughly research neighborhoods and their prices, prioritize written leases overseen by professionals, meticulously examine security and associated services, understand the legal framework for long-term leases, and build a relationship of trust with an experienced landlord or manager. Under these conditions, it becomes possible to transform a market perceived as difficult into a stable living environment, despite its very real challenges.
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Cyril Jarnias is an independent expert in international wealth management with over 20 years of experience. As an expatriate himself, he is dedicated to helping individuals and business leaders build, protect, and pass on their wealth with complete peace of mind.
On his website, cyriljarnias.com, he shares his expertise on international real estate, offshore company formation, and expatriation.
Thanks to his expertise, he offers sound advice to optimize his clients' wealth management. Cyril Jarnias is also recognized for his appearances in many prestigious media outlets such as BFM Business, les Français de l’étranger, Le Figaro, Les Echos, and Mieux vivre votre argent, where he shares his knowledge and know-how in wealth management.
