Strong demand boosts housing construction to near pre-crisis level<\/p>\n
Adianto P. Simamora, The Jakarta Post, Jakarta<\/p>\n
After being in the doldrums throughout the late 1990s economic
\ncrisis, the house-building sector has been rapidly recovering
\nthis year with supply expected to reach near pre-crisis levels
\namid strong demand, according to experts.<\/p>\n
Sindiani Surya Adinata, an analyst at property consultant PT
\nProcon Indah said the relatively stable political and
\nmacroeconomic conditions had triggered developers to begin
\nconstructing houses again.<\/p>\n
Booming demand has resulted from the strengthening rupiah and
\nthe lower interest rate environment, which is reviving consumer
\nconfidence and has in turn been encouraging people to buy new
\nhouses.<\/p>\n
\"Yes, there has been an increase in demand in the construction
\nsector,\" Sindiani said, but added quickly it would take more time
\nfor the house-building sector to fully recover to pre-crisis
\nlevels.<\/p>\n
Industry players, however, are much more optimistic.<\/p>\n
Eppi Pribudhi Soeriawidjaja, president of property developer
\nPT Catur Mitra Persada, said the construction of
\nmiddle-and-upper-class houses would soon reach 1997 levels of
\naround 6,796 and 1,401 units, respectively, this year on the back
\nof strong demand.<\/p>\n
\"Many people in Jakarta, particularly those who were affected
\nby flooding, will start seeking new 'safer' houses this year,\" he
\nsaid.<\/p>\n
He said the strong demand for new houses could be seen by the
\nvarious housing exhibitions that have been held in Jakarta.<\/p>\n
\"In just four months, we have been able to market some 40
\nupper-class houses just in the Pamulang area (Tangerang),\" he
\ntold The Post.<\/p>\n
Darmasetiawan Bachir, secretary-general of the Indonesian
\nAssocation of Real Estate Developers (REI), said demand for low-
\ncost housing was also on the rise.<\/p>\n
He added the supply of low-cost houses this year would reach
\n130,000 units, surpassing the 1997 level of about 120,950 units.<\/p>\n
The government is allocating Rp 255.3 billion in subsidies to
\nhelp low-income people purchase this category of house.<\/p>\n
Sindiani said that in addition to the favorable macroeconomic
\nand political situation, the surge in housing demand this year
\nwas also because of stalled demand in previous years.<\/p>\n
She hoped the government could maintain the current positive
\nsituation so recovery in the property sector would be faster than
\nanticipated.<\/p>\n
Darmasetiawan said that a recovery in the property sector
\nwould have a positive wider effect.<\/p>\n
\"At least 104 industries related to the construction sector
\nwill benefit from the recovery in house building,\" he said.<\/p>\n
The Indonesian Cement Association said earlier that domestic
\ncement consumption was expected to jump to an all-time high of 29
\nmillion tons this year, mainly driven by high demand from the
\nhousing sector.<\/p>",
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