Affordable apartment market needs boost<\/p>\n
The Jakarta Post, Jakarta<\/p>\n
Standing in front of a booth at a property exhibition,
\nbusinessman Lucas was speaking with a marketing officer from an
\nupmarket condominium group about adding a luxury apartment to his
\nlist of property assets.<\/p>\n
\"This year, I am planning to buy another one,\" said Lucas,
\nadding that he had already leased two apartments located
\nstrategically in the heart of Jakarta.<\/p>\n
The country's property sector -- which was blamed as one of
\nthe factors that caused the mid-1997 monetary crisis in the
\ncountry -- is on the rise again as evidenced by a big
\nconstruction push, which started after 1999. And the
\ncapitalization was reported to be 10 times higher in 2003.<\/p>\n
Apartments, as part of the property sector, have also been
\nrising in number due to land efficiency and shift of lifestyle in
\nthe metropolis.<\/p>\n
According to research done by the Center for Indonesian
\nProperty Studies (CIPS), there will have been 65,000 new
\napartments made available in the 1999 to 2007 period.<\/p>\n
By comparison, during the 1980 to 1998 period, there were only
\nabout 25,000 units available.<\/p>\n
Unlike a lot of other countries, apartments in Jakarta are
\nbuilt almost exclusively for the high-end market instead of
\nmiddle or working classes. However, it is those latter two that
\nmost in need of affordable housing and efficient living.<\/p>\n
Moreover, for the low-cost apartments that are built, most of
\nthe units end up in the hands of property investors and
\nspeculators instead of low-income families, which is one of the
\nreasons why such property is not an answer to the city's housing
\nproblems.<\/p>\n
\"We have to consider the skyrocketing land prices in strategic
\nlocations, and that means we need to cater to the wealthier
\npeople to make a profit,\" claimed Gapura Prima managing editor,
\nDjohan Fang. \"But we cannot detect whether the buyers are end-
\nusers or investors.\"<\/p>\n
The Gapura Prima group is the developer of plush apartments
\nThe Bellagio, The Bellagio Mansion and The Belleza, located in
\nKuningan and Permata Hijau, South Jakarta.<\/p>\n
But several marketers of apartments at the property expo said
\nthat at least 50 percent of their buyers are not end-users, such
\nas Lucas who himself lives in a house in South Jakarta.<\/p>\n
\"For now, there is already enough supply for the high-end
\nmarket,\" said leading property consultant Panangian
\nSimanungkalit. \"The most potential market is actually the middle
\nclass, with prices ranging between Rp 150 million and Rp 200
\nmillion.\"<\/p>\n
Unfortunately, he added, there have been few developers
\ninterested in that market segment due to smaller profits.<\/p>\n
According to the CIPS research, total housing needs in Jakarta
\nis about 71,650 units per year. Some 60 percent of it is the
\npotential for middle-lower market apartments, leaving some 10,000
\nunits of demand per year.<\/p>\n
The figure does not include the suburban population on the
\noutskirts of Greater Jakarta.<\/p>\n
\"As long as there are no additional market players in this
\nsegment, there will be a constant demand potentially served,\"
\nPanangian said.<\/p>\n
He mentioned that tax incentives and cross-subsidies in
\nhousing could be offered to developers in a bid to lure them to
\nbuild for the middle and lower class markets, which still have
\ngreat potential.<\/p>\n
Urban planner and lecturer at the Bandung Institute of
\nTechnology's School of Architecture, Achmad Tardiyana, backed the
\nidea that property market, especially in the capital, needs
\nintervention from the government so that it can provide
\naffordable and efficient housing for all segments of society.<\/p>\n
\"It is just the developer's choice in targeting upper class
\nmarkets due to the already high land prices in the downtown
\narea,\" he said. \"The government must intervene in the market
\nthrough a social housing subsidy.\"<\/p>\n
Achmad explained the contrasting income gaps among people will
\nforce the weak to be marginalized and have less access to reside
\nin the city's central areas. (003)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/affordable-apartment-market-needs-boost-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}