Suggestion: Watch the 5 minutes video tutorial before reading this article
With a population of around 30 million people, Jakarta is set to boom once the government changes the regulations of foreign ownership. But ownership regulations are not very transparent nor favorable, compared to other countries in the region, which has resulted in a more passive approach.
Still, many foreigners have already decided to invest here, as they’ve seen the great potentials that will follow the coming years.
In this article, I explain more about Jakarta’s property market, about local property developers and which areas you should have a look at when buying property.
Jakarta real estate market
It’s important that you understand how healthy the market is where you plan to buy property. You don’t want to buy at the peak and see your property value slump after just a couple of years.
So how’s it going in Jakarta?
Property is still undervalued according to many investors, including the Chinese, who plays a big role in its neighboring countries. Indonesia has a huge consumer market, a continuously growing middle class, which has resulted in a great shortage of property as well.
But the market has been stagnating for some years now, in fact, the demand and occupancy rate has decreased by double digits. A weakened demand from the Chinese and the introduction of a 20% luxury for properties worth more than USD 750.000 are two reasons.
Unfavorable regulations of foreign ownership discourage buyers
Regulations of foreign ownership is not very favorable (see my separate guide about buying property in Indonesia), and another reason why foreigners have been discouraged to buy.
Foreigners can’t get freehold ownership, not even of condos. Instead, they need to deal with a number of other title structures that give them the right to either use or lease.