Indonesian property market to remain stable during election year
Property experts confident that buying sentiment in sector will withstand shocks of upcoming polls
The Indonesian real estate market is expected to weather political headwinds in the runup to the April 2019 elections.
The property market in the first semester of 2019 should hold steady despite coinciding with the Indonesian parliamentary and presidential elections, according to Ike Hamdan, head of marketing for Rumah.com.
“The market demands will continue to be stable and the demands for middle to upper-class properties will increase,” Ike was quoted as saying by Tempo.co.
The Indonesian government’s efforts to maintain positive buyer sentiment throughout 2018 have reaped positive results, she added.
A decision to increase the government’s infrastructure budget by six percent year-on-year is also poised to bode significantly well for economic growth.
Experts had previously extolled the government’s plans to make tax rules more conducive to the real estate industry as well as loosen mortgage underwriting standards.
“A number of government policies such as Loan To Value (LTV) and the ‘one million housing program’ will further accommodate people’s needs. Especially the housing needs of the middle to lower class,” Ike explained.
Luxury property sales will soon be taxed at one percent of the selling price, down from the current rate of five percent, Finance Minister Sri Mulyani Indrawati announced late last month.
The threshold for a luxury property tax, currently at 20 percent and applicable to houses and apartments, will also be raised to include residential units worth IDR30 billion (USD2 million), up from IDR20 billion.
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