Supply and demand dynamics influence property price
The real estate sector is competitive, with many real estate agents, developers, property mAnAGEmEnt firms AnD InvEstment companies vying for market share Nathan Kumar Nathan Homes founder
Fiji’s real estate market is a significant contributor to the country’s economy and underpins our household wealth. Several factors affect the property market and property prices, and among the most critical are supply and demand.
Supply and demand in real estate refers to the relationship between the number of properties available for sale or rent (supply) and the number of buyers or renters looking for properties (demand).
When there are more buyers than properties available, prices tend to rise, and when there are more properties than buyers, prices tend to fall.
Nathan Homes founder, Nathan Kumar said supply and demand are two of the most critical factors that influence the property market.
The demand for housing is driven by various factors, including population growth, employment opportunities, and lifestyle preferences.
In contrast, the supply of housing is impacted by factors such as land availability, construction of new housing, building approvals, building costs, and planning regulations.
“Mostly it is the market conditions where property prices are influenced by supply and demand dynamics in the real estate market,” Mr Kumar said.
“Factors such as economic conditions, interest rates, population growth, and job opportunities can impact demand for housing and, in turn, affect property prices,” he said.
Mr Kumar said migration also plays a major role in the demand and supply of properties real estate market.
“Migration can lead to increased demand for housing.
“When more people are moving to a region than leaving it, there is greater need for housing, which can drive up property prices due to the imbalance between supply and demand,” he said.
He also said that such factors have brought in competition in the market between real estate agencies and agents.
“The real estate sector is competitive, with many real estate agents, developers, property management firms and investment companies vying for market share. “Another reason is the uncertainty of the economy such as interest rates, job growth and inflation can lead to hesitancy among buyers and sellers,” he said.