Fuel Price Hike to Affect Housing Prices
Translator
Editor
Minggu, 23 November 2014 13:04 WIB
TEMPO.CO, Jakarta - Fuel price hike is predicted to have an impact on property prices as developers are anticipating an increase in inflation rate.
“We’re still calculating the rate of the increase. In my opinion, houses prices will increase by 5 to 7.5 percent,” Paulus Totok, chairman of East Java chapter of the Indonesian Real Estate Developers Association (REI), said on Friday, November 21, 2014.
According to Totok, the rate of property prices increase would be half as much of the fuel price hike percentage. It means the increasing fuel prices by Rp2,000 would cause house prices to soar by 15 percent. However, Totok reminded that property business did not depend on subsidized fuel, but rather industrial fuel.
“Indeed, cement prices had increased some time ago, but the impact was not significant, Totok added.
If the fuel price hike was not balanced with improvement in bureaucracy, Totok said, house price hike would be unavoidable within a month. Therefore he hopes the government would simplify the procedures for the certificate application.
“During the coordination meeting between the REI and the government on Thursday, November 20, we have signed an agreement with the Agrarian and Spatial Planning Ministry on certificate application through Bank Tabungan Negara (BTN),” Totok said.
According to Totok, the certificate application takeover by BTN would improve efficiency because fuel price hike would be compensated by bureaucracy simplification.
ARTIKA RACHMI FARMITA