Home Sales in Greater Jakarta Sluggish

TEMPO.CO, Jakarta – A research by property consultant Cushman Wakefield shows that, in the first half of 2014, home sales in Jakarta, Bogor, Depok, Tangerang, and Bekasi (Jabodetabek/Greater Jakarta) slumped. Cushman Wakefield noted that the average home sales in the first semester only reached 100 units per month, down by 11 percent from the previous semester.

The decline is expected to have been caused by the recently issued rule on minimum down payment, which was set at 30 percent of houses prices. "Also because of the impact of rising mortgage rates," Cushman and Wakefield chief researcher Arief Raharjo said yesterday.

Meanwhile, Independent global property consultant Knight Frank Asia-Pacific predicted Indonesia will still bum into macro-economic problems that will affect property investments, especially in Jakarta. Hasan Pamudji, Knight Frank Indonesia director for research and consultancy, said that economic slowdown, high interest rates, and the rupiah depreciation against the US dollar are unfavorably factors for the property industry.

"Political issues also create instability in Indonesia's macro-economic conditions, which indirectly lowers sales performances," said Arief.

Arif added that law enforcement in Indonesia has not been able to provide certainty for investors in urban property investments, pointing out how there is no guarantee regarding the legal status of land in the country.

However, Hasan assessed that these problems will not drastically affect the investment climate in Jakarta's property business. He believes that the property sector is still able to grow, as long as there is improvement in the infrastructure sector.

PINGIT ARIA | PRIO HARI KRISTANTO | SAID HELABY