Middle class apartment market seen promising

Middle class apartment market seen promising

JAKARTA (JP): A developer said it would build more apartments
for the middle class as it was a rapidly growing market.

Sarkoro Handajani, marketing director of the Putra Surya
Perkasa group (PSP), said on Monday the company would survey how
many middle class people would actually want to live in
apartments.

He said the market within the monthly income group of Rp 1.5
million (US$619.6) to Rp 5 million was growing up to 6 percent a
year in Greater Jakarta.

"There are around one million families in this group now,"
Sarkoro said.

Now there is an oversupply of upper class apartments, he said,
but middle class ones are still in great demand.

City officials have cited a need for middle class apartments,
but prices offered by developers are higher than the city hoped.
Developers have said land price is their main obstacle.

Last year city secretary Prawoto S. Danoemihardjo said there
was a great need for 30-square-meter apartments priced from Rp 30
million. The city is still finding it difficult to subsidize 50
percent of the apartments priced at Rp 26 million for resettled
slum dwellers.

Meanwhile PSP representatives said their apartments, priced
from Rp 88.7 million, were selling well. Sarkoro said the
relatively cheap prices were because the apartment building was
in a PSP housing complex, Taman Vila Meruya, where facilities
already existed.

Besides buying apartments to live in, people were also
confident about the increased resale value, another marketing
manager said.

Also on Sunday, the developer of the Taman Rasuna apartments,
which are priced from Rp 184 million and claimed by the developer
to be affordable, claimed it would sell its remaining 20 percent
of 953 completed apartments in a short time.

As an incentive for private developers, Governor Surjadi
Soedirdja issued an instruction to make building permits for
cheap apartments easier to obtain.

Technical director Jimmy Sutedjo said he did not know of
incentives, but permits were relatively easier to get since
Surjadi's appeal.

An information officer at PSP said almost 50 percent of the
yet to be built 380 Permata Meruya Apartments in Kembangan, West
Jakarta, had been sold since April 1. Many families had put their
names down for two 48-square-meter two-bedroom apartments priced
from Rp 88.7 million, he said.

Older couples mostly opt for the 96-square-meter three-bedroom
apartments, priced from Rp 164.2 million. Most of the apartments
would have two bedrooms, as the target market was executives with
small families. Higher priced apartments would be on the 19th
floor, at Rp 214 million. Free parking would be available for 402
cars.

A tender for contractors is to be held soon before
construction begins in May, technical director Jimmy said.

Marketing manager Budi Hamidjaja said around 60 percent of the
project funds were derived from the PSP group and the remainder
from consumers' advanced payments.

The Permata Meruya was the seventh apartment project of the
group. Budi said other apartment buildings were under
construction, including Permata Surya in Cengkareng, West
Jakarta.

Permata Surya apartments were priced from Rp 37.5 million but
did not include free parking lots.

Meanwhile PSP's marketing director Sarkoro said the company's
survey found price was still the most important factor in the
decision to buy an apartment.

"The second is location, the third is the developer and the
fourth is the apartment's surroundings," he said. (anr)