Update COVID-19 in Indonesia: 4,223,094 confirmed infections, 142,413 deaths (06 October 2021)
08 October 2021 (closed)
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Investment in homestays as well as the value of houses in Yogyakarta have risen significantly after local authorities implemented a moratorium on new hotel development (effective since Jan. 1, 2014 and will last until at least 1 Jan. 2018). The city and province of Yogyakarta, located in the center of Indonesia's Java island, are important tourist destinations. Moreover the city of Yogyakarta is a key student city. Therefore, demand for houses in Yogya (used for the homestay or student accommodation business) has grown.
Pranowo Lukito, Secretary at the Indonesian Real Estate Brokers Association (Arebi), said - in terms of investment in homestays in Yogya - the return on investment can rapidly go up to 50 percent. In some prime locations in Yogyakarta land prices have already risen to the range of IDR 20 - 25 million (approx. USD $1,700) per square meter, which is rare for locations far outside Indonesia's capital city of Jakarta.
Also the real estate website www.rumah.com reported about consistently rising home prices in Yogyakarta during the first two quarters of 2017. In Q2-2017 home prices stood at an average of IDR 6 million (approx. USD $450) per square meter, up 0.12 percent from the preceding quarter. Wasudewan, Country Manager at Rumah.com, said growth of tourism (in combination with the moratorium of new hotel development) gives rise to growing demand for houses in Yogya. New tourist attractions such as Desa Wisata Rumah Domes and the Jogya Bay Pirates Adventure Waterpark attract new tourists, especially domestic tourists.
Foreign and domestic tourists usually select Yogyakarta as a place to stay when they want to visit the famous Borobudur or Prambanan temples. Yogyakarta has a rich cultural history, being famous for its classical Javanese fine art and culture such as batik, ballet, drama, music, poetry and puppet shows.
Local authorities implemented a moratorium on new hotel construction at the start of 2014 as - due to rising supply of hotel rooms - the hotel occupancy rate had been sliding. One side-effect of this moratorium was that investment in homestays rose, while home prices increased accordingly.