Indonesian Housing market showing positive signs in 2016

The increase in housing sales in several regions of Indonesia is a positive sign of growth in the countrys property sector, according to Indonesia Property Watch (IPW).

“Research conducted by the IPW on the housing sector in the fourth quarter of 2015 revealed a 16.6 percent growth compared to that in the previous quarter,” Ali Tranghanda, the executive director of IPW, stated here on Wednesday.

He admitted that the growth in sales could not yet be taken for granted as a consistent upward trend in sales, but at least it is a positive signal for the housing market.

This is because the growth rate in annual sales is still 10.87 percent lower than that in the previous year, he reminded.

However, based on its research, the IPW found that the sales of houses in the potential areas in Bekasi, a Jakarta buffer town in West Java, had increased significantly by 72.01 percent in the fourth quarter compared to that in the previous quarter.

The sales in other areas of Jakartas satellite towns, such as Bogor, recorded a growth increase of 15.44 percent but dropped by 8.52 percent in Tangerang, which is another Jakarta buffer city in Banten.

“The satellite towns of Bekasi, Bogor, and Depok in West Java are expected to contribute positively to the increase in housing sales in Jakartas areas and Tangerang,” noted Ali.

He reminded that the ongoing construction of public mass transportation projects such as the Mass Rapit Transit (MRT) and the Light Rail Transit (LRT) would increase the added value of houses in the areas.

It was forecast that 2016 would be the year of rising optimism in the property sector in Indonesia, but property businesses should also continue to maintain high vigil, international property consultant Jones LaSalle (JLL) had announced earlier.

“The interest of our investors and residential clients remains high, and we look at 2016 with consistent optimism and vigilance,” Country Head of JLL Indonesia Todd Lauchlan remarked.

Todd noted that 2015 could be viewed as a year full of challenges for the property sector in Indonesia as the economy grew below the predicted target, among other factors.

Moreover, he pointed out that the other factor was the fluctuations in the rupiah and other currencies, which weakened significantly against the US dollar. The drop in the prices of commodities had triggered concerns in Jakarta.

“This year, however, there will be an increasing market demand for offices and residences, while the production sector is also expected to remain stable,” he added.