99 Group Property Outlook 2023: Property Sector Optimism To Support Economic Growth

Photo: Doc. 99 Group

JAKARTA - 99 Group again held a Property Outlook 2023, entitled "Optimism of the Property Sector to Support Economic Growth". This annual event aims to provide comprehensive information on the Indonesian property industry in 2023.

Property Outlook 2023, which was first held face-to-face after the pandemic, presented a panel of speakers who are experts in the property sector and related policy makers. The panelists who attended were Deputy Director of the Macroprudential Policy Department of Bank Indonesia, Agus Fadjar Setiawan, CEO of 99 Group Indonesia, Wasudewan, Director of Public Houses and Commercial Affairs of the Ministry of Public Works and Public Housing, Fitrah Nur, and Head of the Center of Macroeconomics and Finance INDEF, M. Rizal Taufikurahman.

Based on data from 99 Groups throughout 2022, the supply and price of secondary landed houses in Indonesia experienced good growth. Throughout 2022, supply growth was recorded at 30.1 percent (YoY) and price growth was recorded at 2.4 percent (YoY). This data indicates a potential positive trend for property development.

Towards 2023, Indonesia's economic growth has also experienced a recovery period after contracting in 2020 by -2.07 percent. On an annual basis, Indonesia's economic growth in the third quarter of 2022 was recorded at 5.72 percent.

Meanwhile, the World Economic Outlook IMF projects that Indonesia will record an economic growth of 5.3 percent in 2022 (YoY), indicating that Indonesia's macroeconomics is recovering and strengthening. However, as a result of the general global economic conditions, there has been an increase in inflation and interest rates in recent months, this could be a challenge for the property sector in the country.

"To find out the dynamics of the country's property industry, of course, high data accuracy is needed. The 99 Group analyst team has succeeded in presenting data processed from statistics and databases that are constantly updated based on market trends that occur. Through this 2023 Property Outlook, 99 Groups can provide useful advocacy for consumers, agents, property developers, and stakeholders with comprehensive, precise, and accurate data sources," Wasudewan said, Thursday, January 19.

Throughout 2022, the country's property market trend has succeeded in showing positive market changes. The internal data of 99 Groups recorded property searches on the Rumah123.com portal and 99.co averaged 34 million per month, and the time spent per visit was 5 minutes 50 seconds on average, growing compared to 2021 recorded for 4 minutes 23 seconds.

"Because the majority of property seekers on the 99 Group platform, also see the mortgage installment simulation features on our platform, apart from looking for the best property for them, property seekers can also measure financial capacity in mortgage installments. This portion of addition is a positive signal of market recovery with increasing demand from consumers," said Wasudewan.

In terms of property seeker demographics, almost 51 percent are men and 49 percent are women. The trend of shifting consumer age is also seen with the dominance of property seekers of the younger generation.

Property seekers aged 18-24 years contributed 22.0 percent while property seekers aged 25-34 years contributed 26.4 percent. This interesting fact marks an increase in awareness of the importance of property ownership by the younger generation who continues to grow.

"Gen Z, Gen Y is very attractive to technology, but when viewed in the field, stakeholders do not do this. The younger generation has a digital 60 percent life stage, but the information available digitally related to property is actually very minimal. So there is a gap, and it becomes the biggest challenge. 99 Group as a medium, trying to bridge the gap," said Wasudewan.

Meanwhile, landed houses are still the most targeted type of property by property seekers, with a percentage of 80 percent. Based on the price preferences sought on the 99.co and Rumah123.com pages, property at a price of more than IDR 400 million dominates 23.1 percent, followed by houses with a price of IDR 1 billion -IDR 2 billion by 20 percent. However, if viewed based on the change in proportion since 2021, there has been an increase in proportionality to property with a higher price (>IDR 1 billion).

Also attending the 2023 Property Outlook event was a representative of Bank Indonesia, Agus Fadjar Setiawan, who served as Deputy Director of the Macroprudential Policy Department. In his presentation in the first session, it was explained that Indonesia's residential property price index growth was relatively low and stable when compared to other countries.

"Banks BUMN and Private Banks still maintain mortgage interest at a low level, although benchmark interest continues to increase, because banking liquidity is generally still good. Bank Indonesia hopes that with strategic policies such as easing the LTV ratio, the property sector can develop and contribute to boosting national economic growth," explained Fadjar.

On the other hand, the Director of Public and Commercial Houses of the Ministry of Public Works and Public Housing, Fitrah Nur, explained the direction of housing and residential development policies, until 2024. From the establishment of the primary and secondary housing financing systems, including optimizing the use of long-term financing sources such as TASPEN and BPJS Ketenagakerjaan.

"Currently, there are several priority programs carried out by PUPR in order to encourage the pace of the real estate sector this year, including; construction of rental flats for the community, construction of landed houses in disaster-affected areas, improvement of public houses with subsidies of Rp. 20 million rupiah for each family, infrastructure incentives for subsidized housing developers and construction of workers' flats in IKN," said Fitrah.

The presentation session was also enriched by the Head of the Center of Macroeconomics and Finance INDEF, M. Rizal Taufikurahman. He explained that currently, customers who save at a bank with a savings range of IDR 2-5 billion are quite a lot, those who save are young people.

"This generality also needs to get an explanation regarding investment not only in the commodity sector but also in the property sector, so that it can be more productive," said Rizal.