Liquidity improvement will help, says realtor

May 26, 2009 05:55:03 PM

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While much of Fiji’s real estate market reports declining sales, one player is optimistic that a marked improvement in liquidity levels is a good sign for the industry.

Harcourts director Shivas Singh told FijiLive there had been a considerable drop of 40 to 50 per cent in sales and rental levels due to reduced liquidity.

He said if banks in Fiji could not lend to buyers or restricted funds, fewer people would be able to fund house purchases.

However, Singh forecasts an improvement as liquidity increases.

“Signs are already showing,” he told FijiLive.

Singh added banks needed to increase lending because when finance prospects improved, so will the real estate industry.

Liquidity in Fiji’s financial system improved to $153.2 million as at May 18 this year.

The Reserve Bank of Fiji, in its April-end review, attributed the increase to the reduction in the statutory reserve deposit ratio to five per cent, the recall of offshore funds, and the 20 per cent devaluation on the Fiji dollar.

The review said recent regulatory policy measures on the weighted average lending rates of financial institutions should encourage investment-related lending.