Indonesian property players welcome house price increases for foreign buyers

The government’s decision to increase house prices for foreign buyers has been met with positively by Indonesian real estate business players, who reason that it will help to protect the domestic property market.

“If the government keeps the price low for foreign buyers, Indonesians will be forced to bear the high price jump. Therefore, I think this is a right decision,” Association of Housing Development in Indonesia (Apersi) chairman Eddy Ganefo said on Tuesday. He explained that the higher purchasing power of foreigners might hurt the domestic industry.

The price increase is stipulated in a regulation issued by the Agrarian and Spatial Planning Ministry.

The minimum house price set for foreigners in Yogyakarta and Bali now stands at Rp 5 billion (US$371,112) per unit, up from Rp 3 billion under a previous regulation.

In West Nusa Tenggara and North Sumatra, the minimum price also jumped to Rp 3 billion from Rp 2 billion.

Indonesian Real Estate Association (REI) chairman Eddy Hussy said he was optimistic that the changes in price would not affect demand from foreigners to purchase houses.