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Everything you need to know before buying real estate is included in our Indonesia Property Pack
Where are the best places to invest in Indonesia right now? Is Bali still the top pick, or are cities like Jakarta, Yogyakarta, and Surabaya gaining ground? What makes these locations attractive to both local and foreign investors?
We’re often asked these questions because we work directly with notaries, real estate agents, and clients who invest across the archipelago. Our firsthand experience in these markets gives us unique insights into where the real opportunities lie. To save everyone from asking privately, we’ve written this article to share our knowledge broadly.
Our goal is to highlight the hottest markets in Indonesia and explain why they’re worth your attention in 2025.
If you have suggestions or want us to dive deeper into a specific area, let us know. You shoot an email, we answer within 24 hours.
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1) Batam in the Riau Islands is booming with its proximity to Singapore and expanding industrial sector driving housing demand
Batam is a hot property market thanks to its proximity to Singapore.
Singaporean investors are flocking to Batam, with the city accounting for 83.6% of foreign investment in the Riau Islands in early 2023. A standout investment is the USD 11.5 billion glass factory, highlighting Batam's strategic location as a magnet for foreign capital.
The industrial boom in Batam is driving up housing demand. New industrial parks, like the Rempang Eco-City, are popping up, promising a surge in job opportunities. This growth is pulling in workers and expatriates, naturally boosting the need for homes and rentals.
Batam's appeal is further enhanced by its free trade zone system and government incentives. Investors appreciate the ease of handling investment matters and the ability to issue permits across sectors, making it a flexible and attractive option.
Infrastructure is also on the rise, with new roads and bridges supporting Batam's evolution into a major industrial and trade hub. This development is crucial for sustaining the city's growth and meeting the increasing housing demands.
Sources: Future Prediction of the Expansion of Built-Up Areas in Batam Free Trade Zone (FTZ) Using Land Change Modeler, Top 7 Best Business in Batam You Should Consider - InCorp Indonesia, Batam Contributes to Foreign Direct Investment in Riau Islands
2) Semarang’s Tembalang district is attracting interest for student housing investments near major universities
Semarang's Tembalang district is becoming a hotspot for student housing investments.
With Diponegoro University nearby, which enrolls between 35,000 and 39,999 students, there's a constant influx of students needing accommodation. This large student population creates a steady demand for housing, making it a lucrative opportunity for investors.
The interest in student housing is further fueled by the 55,758 registrants for the UNDIP 2022 SBMPTN entrance exam, with 3,258 students accepted. This high number of applicants highlights the growing need for student accommodation in the area, as more students seek places to live each year.
Infrastructure developments are also playing a key role. New student centers are popping up, offering quiet study rooms, social areas, and wellness facilities. These amenities not only attract students but also make the area more appealing for housing investments.
Moreover, there are reports of new housing projects specifically targeting student tenants. This trend indicates a growing interest in student housing investments, as developers recognize the potential for profit in this sector.
Investors are taking note of these developments, seeing Tembalang as a promising area for student housing investments near major universities. The combination of a large student population and modern amenities makes it an attractive option.
Sources: 4icu.org, UNDIP, NAAHQ
We have made this infographic to give you a quick and clear snapshot of the property market in Indonesia. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
3) Yogyakarta’s Sleman area is in demand for its affordable homes and closeness to educational institutions, boosting rental demand
Sleman in Yogyakarta is a hotspot for affordable housing, drawing in both buyers and renters.
What makes Sleman stand out is its close proximity to top universities like Universitas Gadjah Mada, Universitas Negeri Yogyakarta, and Universitas Islam Indonesia. These institutions attract a large number of students, which naturally boosts the demand for housing, especially for those looking for student accommodations.
The rental market here is thriving, with rental yields ranging from 5.13% to 6.47%. This makes it a lucrative spot for property investors who are eyeing steady returns. The high occupancy rates further underline the strong demand for rental properties in the area.
For those considering buying property, Sleman offers a unique advantage. Property prices here are generally lower than in other parts of Yogyakarta, making it an attractive option for budget-conscious buyers. This affordability, combined with the area's educational appeal, makes it a smart choice for investment.
Living in Sleman also means being part of a vibrant community, thanks to the influx of students and academics. This creates a lively atmosphere, with plenty of cafes, bookstores, and cultural events that cater to a youthful crowd.
Whether you're looking to buy or rent, Sleman's combination of affordability and educational proximity makes it a compelling choice. The area's growth potential and strong rental market are just the icing on the cake.
Sources: Jurnal Saintek, 4ICU, Global Property Guide, Brookfield Oaktree
5) Manado in North Sulawesi is attracting interest for its coastal properties and tourism-driven real estate growth potential
Manado in North Sulawesi is quickly becoming a sought-after destination for coastal properties and tourism-driven real estate.
Thanks to a steady rise in international visitors, Manado's tourism has seen impressive growth. Back in 2004, the city welcomed 16,930 international visitors, and by 2018, that number had soared to 122,100. This upward trend continues, drawing more attention to the area.
Traveling to Manado has never been easier, with direct flights now connecting the city to 12 destinations across four countries. The Sam Ratulangi International Airport's improved connectivity is a major attraction for tourists and investors alike, making the city more accessible than ever.
The Indonesian government is also investing heavily in Manado's future. They've earmarked funds to transform the Malalayang Beach area into a vibrant waterfront city, boosting infrastructure like roads and water supply. These developments are set to enhance Manado's appeal to both tourists and investors.
With the influx of visitors, there's a growing demand for new hotels and resorts. This surge in hospitality needs signals a strong potential for real estate growth in the area. International investors are taking notice, drawn by Manado's thriving tourism scene and expanding infrastructure.
As Manado continues to evolve, its real estate market is poised for significant growth, driven by tourism and strategic developments. The city's unique charm and improved accessibility make it an attractive option for those looking to invest in coastal properties.
Sources: Hotel Investment Strategies, Direct Flights, Setkab, Wikipedia
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7) Medan's Setiabudi area is booming with rising property prices thanks to new shopping centers and better transport links
Medan's Setiabudi area is buzzing with excitement as property prices are on the rise.
One of the main reasons for this surge is the arrival of new shopping centers like Delipark Mall, which offers luxury shopping and dining experiences that attract both locals and tourists. This modern hub has quickly become a favorite spot, adding a vibrant touch to the neighborhood.
Transportation improvements are also playing a big role in this transformation. While we don't have exact details on new bus routes or train stations, Medan's focus on urban development is making Setiabudi more accessible. This aligns perfectly with what homebuyers are looking for: convenience and connectivity.
In the broader Indonesian property market, especially in Medan, there's a noticeable uptick. Properties priced between Rp 1 billion and Rp 3 billion are seeing a 34.7% increase in demand, highlighting Setiabudi as a prime spot for investment. This demand is fueled by the area's new amenities and better infrastructure.
For those considering a property purchase, Setiabudi offers a promising opportunity. The combination of modern shopping experiences and improved transport links makes it an attractive choice for both living and investment.
Sources: Global Property Guide, Tripadvisor, The Lets Move Group
8) Palembang's Jakabaring area is gaining interest for its sports facilities and post-Asian Games infrastructure upgrades
Palembang's Jakabaring area is now a hotspot for investors, thanks to its post-Asian Games transformation.
After the Asian Games, the area saw a surge in property development projects, driven by a strategic plan to boost infrastructure. This plan is key to drawing in investors who are eager to capitalize on the area's growth potential.
The Indonesian government has been a major player in this transformation, increasing its infrastructure budget by 7.8% in 2024. This boost focuses on essential sectors like transport, renewable energy, manufacturing, and housing, setting the stage for further development in Jakabaring.
Transportation improvements have been a game-changer, with the new LRT line connecting Sultan Mahmud Badaruddin II International Airport directly to the Jakabaring sports center. This makes the area more accessible and appealing to potential investors, who see the convenience as a major plus.
Jakabaring's sports facilities, enhanced for the Asian Games, continue to attract attention. These world-class amenities are a significant draw for investors looking to tap into the sports tourism market.
With these developments, Jakabaring is not just a place to invest; it's a thriving community with a promising future. The combination of improved infrastructure and sports facilities is a winning formula for those looking to invest in the region.
We made this infographic to show you how property prices in Indonesia compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
9) Surabaya's West Surabaya district is gaining interest with new infrastructure and commercial developments driving property value growth
West Surabaya is quickly becoming a prime spot for property investment.
Thanks to major government investments in infrastructure, the area is now more accessible and appealing. The Indonesian government is working on projects like the Jakarta-Surabaya semi-high speed railway, which is part of a national strategy to boost connectivity and economic growth. This railway project is making West Surabaya a more attractive option for property investors.
Additionally, new toll roads and improved public transportation have made getting around the region much easier. This convenience is drawing more people to consider living in West Surabaya, leading to a noticeable increase in property transactions. As more buyers show interest, property values are climbing.
Commercial developments are also a big part of the story. With the rise of large shopping malls like Pakuwon Mall and new business centers, the area is buzzing with commercial activity. These developments are not just bringing in more visitors; they are also pushing property values higher.
For those looking to invest, West Surabaya offers a promising opportunity. The combination of infrastructure improvements and commercial growth is creating a vibrant environment for both residential and commercial properties.
As the area continues to develop, property values are expected to keep rising, making it an exciting time for potential buyers. The ongoing projects and developments are setting the stage for a thriving property market in West Surabaya.
Sources: PwC Indonesia, Wikipedia, indonesia-price-forecasts
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility.