House Prices Below IDR 2 Billion Record The Highest Increase After The Pandemic, BTN: This Is A Positive Momentum

The Housing Finance Center, a research institute owned by PT Bank Tabungan Negara (Persero) Tbk, recorded as of the third quarter of 2023, the national price of the house recorded the highest increase since the pandemic. The house under IDR 2 billion became the largest contributor to the increase.

In a study released by the Housing Finance Center (HFC), the House Price Index (HPI) for the third quarter of 2023 reached 211.9 or experienced the highest growth after the pandemic of 8.7 percent on an annual basis (year-on-year/yoy). The increase was driven by a large house or Type 70 with a price ranging from Rp500 million to Rp1 billion which recorded an increase of 12 percent yoy in the third quarter of 2023.

Director of Consumer Bank BTN Hirwandi Gafar said the increase in house prices was a reflection of increasing home demand in the community.

"We think this condition will last until the end of the year in line with the incentives for VAT DPT from the Government for houses below Rp. 2 billion. This condition is certainly a momentum for positive growth for Bank BTN," Hirwandi explained in Jakarta, Wednesday, November 15.

Furthermore, BTN's HFC research also stated that the increase in house prices was also contributed by small houses or type 36 with prices below IDR 350 million. HFC noted that type 36 house prices grew 8.4 percent yoy.

Meanwhile, based on data from Bank BTN, the composition of mortgage distribution for prices is below Rp. 2 billion at most in West Java Province or around 44%. Then, the largest distribution of mortgages was followed by East Java, Banten, and Central Java Provinces. For outside Java, on the islands of Sumatra, Jambi Province, South Sumatra Province and North Sumatra are in the highest position for mortgage distribution at Bank BTN.

"The provinces with the highest growth occurred outside Java, namely Central Kalimantan, West Sumatra, Riau Islands, North Kalimantan, and East Kalimantan," explained Hirwandi.

Hirwandi added, during the first eight months of this year, Bank BTN has also distributed Home Ownership Loans (KPR), both Subsidy and Non-Subsidy, amounting to Rp27.5 trillion or grew 17.9 percent yoy. The increase was recorded to be still above the industry average. Based on data from Bank Indonesia, KPR nationally grew 12.3 percent yoy in September 2023, higher than the previous quarter or as of June 2023 by 10.6 percent yoy.

Meanwhile, Kresna Hutabarat, an analyst at Mandiri Sekuritas in his research, maintains purchase recommendations for Bank BTN with a target price of IDR 1,800. Kresna projects that BBTN's net profit in 2023 can reach IDR 3.37 trillion or grow 10.7 percent from the previous year's period. With this assumption, ROAE is estimated to reach 12 percent this year.