Beware Stubborn Developers and Stalled Apartment Projects: How to Avoid Regret

Jakarta, CNBC Indonesia – Buying an affordable apartment has increasingly become a popular housing option in urban areas. However, amid a growing number of cases in which apartment projects are not completed and are left abandoned, prospective buyers need to exercise extra caution.

As quoted by detikProperti on Saturday (10 October 2026), Colliers Indonesia Head of Research Department Ferry Salanto said middle-market apartments were a key target for buyers, who are relatively sensitive to price. Even so, a low price alone can no longer be treated as a decisive factor when buying an apartment, given the high level of risk.

“Buying an apartment is different from buying a product that is already available, especially when buying at the pre-sale stage. Consumers are not just buying a unit; they are also buying the developer’s promise. That promise is whether the developer can complete the project several years later, in line with the specifications and schedule provided,” he said.

The prevalence of delayed and even stalled apartment construction projects in Indonesia has directly undermined prospective buyers’ confidence. Buyers are therefore strongly advised to thoroughly check the project’s legality and land ownership before making a transaction.

“At the very least, consumers should look at several things. First, the legality of the project and the land. They also need to monitor actual construction progress,” he said.

Prospective buyers should also investigate the developer’s track record and carefully review the contents of the Sale and Purchase Preliminary Agreement (PPJB), particularly the handover deadline and penalties for delays.

“On the other hand, if consumers have the financial means in the current market, they could also consider a unit that is ready for occupation, a ready-stock unit, or a project that is further along in construction,” Ferry said.

“For first-time buyers, the principle is not just, in English, ‘Can I afford to buy?’ but, more importantly, ‘Can I afford the risk?’ Price remains important, but certainty over delivery and product quality should be just as important,” he concluded.

Huge Capital Requirements and Stubborn Developers Behind the Problem

Indonesia Property Watch CEO Ali Tranghanda said the main reason so many projects were running into trouble was developers’ lack of capital. The cost of building an apartment, he said, could not be compared with that of ordinary landed housing because it required enormous funding.

“It is indeed different from developing a landed project. Apartment projects require substantial financial capacity and sound cash-flow management to avoid work grinding to a halt midway,” he said.

Another factor fuelling the crisis is that demand remains far below the supply of units on the market. The problem is compounded by selling prices that are too high for buyers’ purchasing power, although the ideal price for a middle-income apartment should be between Rp 300 million and Rp 500 million.

“Demand is certainly not as large as the existing supply. Demand is closely linked to apartment selling prices, which remain higher than the purchasing power of the urban middle class. The cheapest apartments should be priced at around Rp 300 million to Rp 500 million, but market prices have already exceeded that,” Ali said.

Global Asset Management director Steve Sudijanto added that the crisis had been worsened by developers who pressed ahead without obtaining construction permits.

Some developers short of funds had even promised to build two apartment towers despite having only Rp 25 billion to Rp 50 billion in capital.

“Projects usually stall because developers insist on going ahead. They have not obtained the permits, so construction grinds to a halt. Developers should not stubbornly push ahead just to make a profit in areas not zoned for apartment or commercial development. They press on, then struggle to get permits, and the project stalls. Secondly, they run out of money. They loudly announce plans to build two apartment towers when they have only Rp 50 billion. There are developers with just Rp 25 billion who say they will build two towers, even though building an apartment can cost hundreds of billions,” Steve said.