West Java Property Sales Face Headwinds from Weakening Purchasing Power and Rising Material Costs
Property sales in West Java are facing a number of significant challenges this year, including a decline in public purchasing power. Furthermore, the strengthening of the US dollar against the rupiah has exacerbated conditions for the property business by driving up the cost of building materials.
According to the Chairman of the Regional Leadership Council of Real Estate Indonesia (REI) West Java, Norman Nurdjaman, these challenges have caused property sales to drop by approximately 30 to 40 percent compared to the previous year.
“The cause of the sales decline is primarily public purchasing power. This purchasing power has actually been declining since last year. Since the beginning of 2025, deflationary conditions have already been occurring in our country. Even now, with the dollar rising, building materials are also going up. When the dollar rises, building material costs rise,” Norman stated on Wednesday (15/7/2026).
In addition to building material prices, he said, imported substitute materials have also experienced price increases, such as door handles and other fittings. Moreover, in West Java, a specific moratorium on mining has been in effect since August 2025 following a landslide disaster in Cirebon.
“The Governor imposed a moratorium on class C quarries. So everything has gone up. The increase in material costs is fantastic, starting from 50 percent upwards, with some experiencing a 100 percent increase. Consequently, many of our members, for instance in Cirebon, are importing materials from Central Java. The prices have definitely skyrocketed, or they source from other regions where materials are still available, resulting in higher prices,” he explained.
This price surge, he noted, has triggered inflation. Currently, the situation is in a state of stagflation, where deflation and inflation occur simultaneously.
“This stagflation condition is actually a situation that is highly avoided in a country or region because, as mentioned, the impact inevitably affects people’s incomes, causing them to decline. If income falls, profits fall, and earnings decrease,” he said.
Norman mentioned that one of the measures being taken to boost property sales is conducting Digital Marketing training for all marketing staff within the REI West Java membership. This training is a continuation of a previous programme held in September 2025. “So, we are equipping our REI West Java members, their content creators, and their marketing teams by broadening their insights and providing technical skills related to social media,” he said.
Regarding housing needs in West Java, Norman stated that nationally, the demand for homes stands at 15 million units. However, according to the government’s version, the housing backlog is 10 million units. “Now, West Java accounts for at least 20 percent of that, meaning there is a need for 2 million homes. This is actually an available market that is very good for developers. Our target, like the quota, is only 350,000 units, so it is a very realistic goal to achieve when looking at the available market,” he explained.
When asked about the obstacles developers face in meeting sales targets, Norman said that buyers are often hindered by the OJK Financial Information Service System (SLIK). This is despite a government agreement with the Financial Services Authority (OJK) that negative SLIK records below IDR 1 million should be annulled. “But banks look at it from another perspective. Banks always adhere to the 5C principles. Banks do not just look at the government regulation that records under IDR 1 million can be annulled; they see that this consumer has a character that cannot be held accountable or something similar. So there are many problems,” he said.