Global real estate services firm Jones Lang LaSalle expects condominium sales in Indonesia to post a record-breaking figure in 2014, particularly supported by the current trend in Jakarta (Indonesia’s capital city) where people continue to shift to apartment living instead of detached or attached single-unit housing. Anton Sitorus, head of research at Jones Lang LaSalle, said that despite the weaker outlook for Indonesia’s property market, both developers and buyers have shown increased interest in developing and buying property.
A recent Jones Lang LaSalle report shows that Indonesian developers launched about 4,000 new condominium units between April and June 2014 (including the St. Moritz, developed by the Lippo Group, in West Jakarta and the Raffles Residence, developed by the Ciputra Group, in Central Jakarta). Moreover, over 7,400 units have been sold in the past six months.
In 2013, the condominium supply in Indonesia reached a total of 13,500 units and Jones LaSalle expects the supply to accelerate to 15,000 units in 2014 and 16,000 units in 2016. Luke Rowe, head of residential property at Jones Lang LaSalle, said that between 2014 and 2020, Jakarta (with a population of about 10 million people) may see an increase up to 20,000 new units per year. Rowe added that this year's peaceful presidential campaigns and election contributed to increased optimism on Indonesia’s property sector. If there will be no major disturbances after the official election result has been announced by the General Elections Commission (KPU) on 22 July 2014, then Jones Lang LaSalle expects the next two quarters to be positive and may convince developers to undertake more condominium projects.
The Jones Lang LaSalle report also showed that there currently are an estimated 92,490 condominium units in Jakarta, 94 percent of which are occupied. Furthermore, around 53,660 units are expected to be added by 2017, around 73 percent of which are already sold.
Regarding property prices, Sitorus said that condominium prices (particularly the upmarket) are expected to remain stable in 2014. Demand for condominiums is especially seen rising in West Jakarta (Puri Indah and Kebon Jeruk areas) and South Jakarta (Kebayoran and T.B. Simatupang areas), where generally the richer segments of Jakarta society live.
A few weeks ago, it was reported that presidential hopeful Joko Widodo, popularly known as Jokowi (and who leads the credible quick count scores) plans to allow foreigners to own apartments valued at least IDR 2.5 billion (USD $213,000) in order to generate more government tax income.