Property sector expected to revive in 2-3 years
IO – His name is Aryo Danudoro. This man from Jakarta has been in the property world for the last 15 years. “Currently I am working with a multinational property company,” said the man who was born on December 28, 1981.
Holder of an MBA from Gadjah Mada University, Aryo point out how at the beginning of the pandemic the property business suffered a significant shock. However, it has currently started to revive, especially in the residential sector, starting with the many incentives issued by the government. For example, the VAT exemption for property buyers, 0% down payment, and also from the developer side there is the ease of receiving mortgage financing from Home Ownership Credit, namely, where the developer will receive 100% of the financing when signing a loan. Although starting to come around after a long hibernation, Aryo admitted that property sales, especially in housing estates, are down by around 60%.
Not only has demand for housing shrunk: apartment sales began to fall off even before the pandemic, as the supply for apartments in Jakarta and its surroundings is extreme, compared to the level of demand in the market. There is also the factor of price competition, especially in the secondary market, which results in the primary market being sluggish and less welcoming. “The price difference in the secondary market is 20% to 30% below the primary market,” said the man who likes to play golf.
According to Aryo, the property market is currently still active in the middle-low and middle segments, especially for end-users. “Property investment is currently targeted more for landed houses with prices ranging between IDR 500 million – IDR 1 billion; the market niche in this segment is still very dynamic and the market wide open,” he explained.
If you are considering a purchase of property right now, Aryo suggests paying close attention to the track record of the developer, then the price, and the ease with which you can pay.
Considering the current situation, it is surmised that it will take the next 2-3 years for the property sector to fully revive. “We hope that the government will energetically support it: when the property sector is booming it will exert an impact on national economic growth, because the property sector contributes 20% to the national economy,” he said.
The biggest challenge in the property business during the pandemic is the lack of sales, which impacts the sustainability of the company. Therefore, it is expected that developers must be adroit in seeing opportunities in this business, and be effective & fast in executing a strategy.
Due to the current difficult situation, special steps are needed to survive in this business. “Developers must be effective, efficient, creative, and willing to sacrifice a little,” concluded the man who likes reading. (Dessy)