Competition in property predicted to get tighter
Competition in property predicted to get tighter
JAKARTA (JP): The property market will be tighter next year,
according to the head of the association of Indonesian real
estate developers' supervisory board.
M.S. Hidayat told property developers Wednesday to adopt new
marketing strategies to survive next year.
"The competition in the property market next year will be very
tight. Small and medium developers will find it hard to survive
without adopting new marketing concepts," he was quoted by Antara
as saying.
He agreed with analysts and businesspeople that the property
market slump would continue next year because of oversupply.
Property analyst Panangian Simanungkalit predicted 625
developers would go bust next year because of their liabilities,
legal problems and the weakening market.
He predicted problem loans in the property sector would reach
Rp 5.6 trillion (US$2.41 billion) next year, up from Rp 5.25
trillion this year.
Property baron Ciputra said the weakening market would largely
affect small and medium developers, while big developers would
continue to reap profits.
He predicted only 200 developers would go bankrupt.
Hidayat said developers had to market progressively to get
buyers, such as via door-to-door sales instead of relying on
advertising.
Buyers were becoming more choosy, preferring housing complexes
with good environments, security, accessibility and affordable
prices, he said.
He said the government had ruled that developers create good
environments at their developments. They had to allocate 40
percent of their housing estates for roads, parks and other
amenities.
Developers could create security with only one gateway to
housing complexes, he said.
On accessibility, Hidayat said buyers would buy houses at
faraway complexes so long as there was accessible transportation.
Buyers were also keen on house designs.
"In the past, if they heard there was a cheap housing complex,
they soon put up their booking fees. Now, they first survey the
location and check out house designs," he said.
Hidayat urged developers to focus on the medium and cheap
housing market because the property market would be dominated by
residents, not investors.
"Complexes with big and expensive houses will not sell next
year," he said. (jsk)