Relax foreign ownership regulations: Indonesian brokers to government

Double-digit industry growth to occur if impediments to international buying loosened

The Indonesian government should relax property curbs on foreign buyers to catalyse growth in the real estate industry, a leading broker suggested to The Jakarta Post.

Growth in the property industry could reach 30 percent, up from the projected increase of 6 percent this year, if the government loosens certain foreign ownership rules, suggested Indonesia Real Estate Broker Association (AREBI) chairman Lukas Bong.

Foreigners currently face significant deterrents to buying and owning property in the country. “We want the government to open up ownership of luxury apartments to foreigners,” Lukas was quoted as saying by the Post.

“Many foreigners, such as those from Japan, Hong Kong and other Asian countries, actually want to buy apartments here.”

Foreign property seekers in Indonesia are only allowed to purchase homes at certain prices, with caps firmly in place in large cities. In Jakarta, for instance, foreigners may not buy an apartment fetching prices beyond IDR5 billion (USD355,200), as stipulated under Government Regulation No.103/2015 and Agrarian Ministerial Regulation No. 13/2016.

However, the industry would do well to sell apartments in prices of IDR10 billion to IDR20 billion to foreigners, as this pricing segment would benefit the property industry rather than cause harm, said Lukas.

“I believe many are interested in buying property as many foreigners want to enter Indonesia,” he told the Post.