Authored by the expert who managed and guided the team behind the Indonesia Property Pack
Yes, the analysis of Jakarta's property market is included in our pack
Are you considering investing in Jakarta's property market? Curious about the emerging trends that could shape your investment decisions by 2025? Wondering how urban development and economic shifts might impact property values?
We will lay down recent insights, providing a clear picture of the future landscape. Here, no guesswork, we rely only on solid data.
Actually, we know this market inside and out. We keep tabs on it regularly, and all our discoveries are reflected in the most recent version of the Indonesia Property Pack
1) Stricter property ownership rules will reduce foreign investment in specific Jakarta areas
Stricter regulations on property ownership in Jakarta are reshaping the landscape for foreign investors.
In recent years, the Indonesian government has rolled out new rules, like Government Regulation No. 103 of 2015 and Government Regulation No. 18 of 2021, which have made it tougher for foreigners to buy property. These regulations introduced a minimum price for properties that foreigners can purchase. For instance, in Jakarta, foreigners need to shell out at least Rp 3 billion for an apartment and Rp 5 billion for a landed house. This high price threshold is a significant barrier for many potential investors.
Foreigners are also limited to owning just one plot of land, and it can't be more than 2,000 square meters for a landed house. If they want to expand, they must prove their investment will have a positive economic impact. This requirement, along with the need to comply with specific residential zoning rules, makes it even more challenging for foreign buyers to find suitable properties.
These zoning requirements mean that not all types of properties are available to foreign buyers, further narrowing their options. The combination of these factors has led to a noticeable decline in foreign investment in Jakarta's property market.
Sources: The Jakarta Post, Invest Indonesia
2) Foreign investment in Jakarta's residential market will surge as new regulations ease ownership restrictions
Jakarta's residential market is buzzing with increased foreign investment thanks to new regulations.
In 2023, the Indonesian government made a game-changing decision by relaxing property ownership rules for foreigners. Now, with a minimum price set at IDR 3 billion, foreigners can own up to 20% of property units. This move has opened doors for international buyers, making Jakarta a hot spot for real estate investment.
By 2024, the effects of these changes were clear. There was a surge in interest from foreign buyers, especially in the residential market. Properties priced between IDR 1 billion and IDR 3 billion became a favorite, making up 34.7% of property searches by foreign nationals. Landed houses and apartments were particularly in demand, showing a clear preference for these types of homes.
Real estate agencies like JLL Indonesia have reported a growing interest from international investors. The market in Jakarta, particularly in the CBD’s Class A office rental sector, is thriving. Premium rental spaces have seen a rise in rates, reflecting the market's recovery and the appeal of investing in Jakarta.
With these relaxed regulations, Jakarta is now a favorable environment for foreign investment. The combination of regulatory changes and market recovery is drawing more international attention, making it an exciting time for potential buyers.
Sources: Kompas, Asianews Network, Invest Indonesia
Everything you need to know is included in our Property Pack for Jakarta
3) Foreign buyers target properties near international schools and amenities
Foreign buyers are zeroing in on properties near international schools and amenities for a variety of compelling reasons.
In Jakarta, the demand for international schools is booming, with institutions like Jakarta Intercultural School and New Zealand School Jakarta expanding their offerings to meet the needs of a growing expatriate community. This trend is particularly noticeable in 2023 and 2024, as more schools are being established to cater to this demographic. Expatriate families prioritize proximity to these schools because they offer globally recognized curricula like the International Baccalaureate and Cambridge IGCSE, ensuring continuity in their children's education.
Surveys consistently reveal that expatriates prefer living near international schools, driven by the need for quality education and a familiar environment for their children. Real estate market reports show that property prices in these areas are climbing, largely due to high demand from expatriates. This demand is not just about education; it's also about lifestyle.
The development of new amenities, such as shopping centers and recreational facilities, near these schools further enhances the appeal of these areas. These amenities make the neighborhoods more attractive to foreign buyers, who are looking for convenience and a high quality of life. The presence of international schools acts as a magnet, drawing in families who want the best for their children.
For expatriates, living near international schools is not just about education; it's about creating a home away from home. The familiar environment and community support are invaluable for families adjusting to a new country. This sense of community is a significant factor in their decision-making process when choosing where to live.
As more expatriates move to Jakarta, the demand for properties in these areas is expected to continue rising. This trend is likely to drive further development and investment in neighborhoods with international schools and amenities, making them even more appealing to foreign buyers.
Sources: Social Expat, British School Jakarta, Asia News Network
4) New tax incentives for green buildings boost interest in eco-friendly residential developments
In Jakarta, there's been a surge in eco-friendly residential projects recently.
Back in 2023, the city saw green buildings exceeding expectations by reaching 3.99% of the target, which was initially set at 2.5%. This upward trend is likely to continue, with predictions that by 2025, green buildings will make up 11.97% of the total, surpassing the target of 7.5%.
What's driving this growth? The DKI Jakarta Provincial Government has introduced new tax incentives for green buildings. They offer significant tax breaks: a 30% PBB discount for Bronze-certified buildings, 50% for Silver-certified, and 60% for Gold-certified buildings. These incentives make it financially attractive for developers and homeowners to invest in eco-friendly residential developments.
Moreover, the market for green building materials in the Asia Pacific region is booming. In 2023, it was valued at USD 105.78 billion, and it's projected to grow to USD 344.79 billion by 2033. This growth indicates a rising demand for sustainable building materials, further fueling interest in green residential projects.
For those considering buying property in Jakarta, these developments mean more options for sustainable living. The city's commitment to eco-friendly construction is not just about meeting targets; it's about creating a healthier environment for its residents.
Sources: Jurnalku, Precedence Research
5) Flood-prone areas in Jakarta will see reduced property interest due to rising climate concerns
Jakarta is seeing more floods, with 1,255 incidents in 2023 alone.
As climate change worsens, flood-prone areas are becoming less attractive to property buyers. The costs of flood damage in Jakarta are expected to skyrocket, potentially increasing by 322% to 402% by 2050. This means property values in these areas could take a hit.
Living in a flood zone also means higher insurance premiums. With economic losses from flooding reaching USD 500 million annually, these extra costs make such properties less appealing.
Reports from the World Bank Group and Asian Development Bank highlight Jakarta's vulnerability to climate hazards like flooding and sea-level rise. This official recognition of risk is a red flag for potential buyers.
Buyers are shifting away from high-risk areas as they become more aware of climate change impacts. Real estate agents note that flooding risks are a growing concern for those considering property in Jakarta.
Neighborhoods like Kec. Pancoran and Kec. Kebayoran Lama, which have faced recurrent flooding, are seeing reduced demand due to these risks. Media and social media discussions further emphasize the dangers, contributing to decreased interest in these areas.
Sources: Statista, PreventionWeb, Yale Climate Communication, ReliefWeb, PubMed
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6) Community-focused living will boost demand for developments with shared amenities
In Jakarta, co-living spaces are becoming increasingly popular due to the city's high living costs and limited affordable housing.
Many young professionals and millennials are drawn to these spaces because they offer affordability, convenience, and social opportunities. Developments like Cove Prima in Antasari and Cozy Coliving in Fatmawati are leading the way, providing fully furnished private rooms with en-suite bathrooms and shared amenities like co-working spaces, fitness centers, and rooftop gardens.
These shared amenities not only make living more affordable but also enhance the social experience for residents. People enjoy the sense of community and support that comes with co-living, making it a preferred choice for digital nomads, expats, and even pet owners.
Consumer surveys highlight a strong preference for community-focused living. This trend is evident in the growing number of real estate projects in Jakarta that emphasize communal spaces. The "Kampung Deret" program, for example, is transforming slum areas into organized two-storey buildings with public facilities, addressing the need for affordable and convenient housing solutions.
As more people seek out these community-oriented living arrangements, the demand for developments with shared amenities is expected to rise. This shift is not just about affordability but also about creating a lifestyle that fosters connection and collaboration among residents.
In Jakarta, the trend towards co-living is reshaping the real estate landscape, with more projects focusing on creating vibrant communities rather than just providing a place to live.
Sources: Social Expat, Kompas
7) Demand for traditional houses will drop as people prefer modern living with convenience and amenities
Jakarta's housing market is shifting towards modern living spaces with a focus on convenience and amenities.
In 2023, the appeal of apartments and condominiums surged, with sales rates climbing to 93.8% by the year's end. This trend is particularly noticeable in areas like Kemang and South Jakarta, where high-rise developments are booming. These areas are becoming hotspots due to their mixed-use complexes, which offer everything from swimming pools to 24-hour security, making them a top choice for many.
Buyers are increasingly interested in properties that come with modern facilities like smart home devices and integrated security systems. This shift is not just about luxury; it's about the convenience and lifestyle that these features offer. The rise of co-living spaces is also a testament to this trend, providing affordable and community-oriented living options that are especially popular among millennials and young professionals.
Mixed-use complexes are a game-changer, offering a blend of residential, commercial, and recreational spaces all in one place. This setup is not only convenient but also aligns with the fast-paced lifestyle of Jakarta's urban dwellers. The demand for such integrated living solutions is a clear indicator of changing preferences.
As more people gravitate towards these modern living arrangements, traditional houses are losing their appeal. The desire for convenience and a range of amenities is reshaping the housing landscape, with more buyers opting for properties that offer a complete lifestyle package.
In essence, the housing market in Jakarta is evolving, with a clear shift towards modern, amenity-rich living spaces. This trend is driven by a combination of factors, including the development of mixed-use complexes and the growing popularity of co-living spaces.
Sources: Global Property Guide, Statista, Social Expat
8) Demand will surge in South Jakarta as new green spaces and parks are developed
The southern neighborhoods of Jakarta are becoming a hot spot due to the development of new green spaces and parks.
Since 2022, the area has seen the establishment of 54 new parks, making it more attractive and driving up property prices. People are flocking to these neighborhoods, eager to live near these lush, beautiful spaces. The demand for homes in southern Jakarta is on the rise, with more real estate transactions happening as buyers seek properties close to these green areas.
Surveys indicate that buyers have a strong preference for homes near parks, and the high demand for such properties reflects this trend. The Jakarta government's urban development plans have prioritized creating new parks, enhancing the area's livability and appeal. This focus on green infrastructure not only improves climate resilience but also boosts the desirability of the neighborhoods.
Media coverage has been buzzing about the benefits of living near parks, such as improved health and quality of life, which draws even more residents. The new parks have also sparked increased foot traffic and business activity, with a noticeable uptick in cafes and restaurants opening nearby. This vibrant atmosphere adds to the charm and allure of the southern neighborhoods.
Investments in green infrastructure have not only improved living conditions but have also made these areas more appealing to potential buyers. The government's efforts to enhance climate resilience through these developments have further fueled the demand for properties. As a result, the southern neighborhoods are experiencing a surge in popularity and growth.
Sources: WRI, EEER, Frontiers in Human Dynamics
Everything you need to know is included in our Pack for Jakarta
9) Central Jakarta will keep strong demand as the city's business and cultural hub
Central Jakarta is the beating heart of the city, thriving as both a business and cultural hub.
In 2024, the Central Business District (CBD) boasted a 73.0% occupancy rate, a testament to its strategic allure for local and multinational companies. This area is a magnet for businesses, especially those in the technology sector, which consistently lease over 8,000 square meters of office space each quarter.
The "golden triangle" area, spanning Central and South Jakarta, is a hotspot for Grade A office space, making it a prime choice for businesses. Property prices here have either stayed stable or risen, with residential properties averaging IDR 25 million per square meter in 2025, highlighting the area's desirability.
Retail spaces are buzzing too, with foot traffic and consumer spending keeping occupancy rates steady at 74%-75% by the end of 2024. This vibrant activity is a clear indicator of the area's ongoing appeal.
While specific government infrastructure projects in Central Jakarta aren't detailed, their overall investment has fueled growth. The presence of major cultural landmarks, high-end hotels, and restaurants further cements Central Jakarta's status as a cultural and business epicenter.
These elements collectively ensure that Central Jakarta will maintain stable demand, continuing to attract businesses and residents alike.
Sources: Real Estate Asia, JLL, Jakarta Market Data, Real Estate Asia
10) Virtual reality tours will dominate property marketing and attract tech-savvy buyers
Virtual reality tours are becoming a game-changer in property marketing, especially for tech-savvy buyers.
In places like Jakarta, the surge in internet and smartphone use is making virtual tours more popular. With internet penetration in Indonesia rising to 79.5% in 2024, younger generations are leading the charge. Millennials and Gen Z are particularly keen, with those aged 18 to 34 being 130% more likely to book a property with a virtual tour. This shows a clear shift towards digital solutions among younger buyers.
VR technology is not just a fancy add-on; it's becoming more accessible and affordable. This means potential buyers can now explore properties from the comfort of their homes. Businesses using virtual tours have seen increased bookings and conversion rates, proving its effectiveness. The integration of VR into social media platforms has also boosted user engagement, making it a must-have tool for property marketing.
Collaboration between tech companies and real estate firms is pushing the development of advanced VR solutions. This partnership is making it easier for agents to offer immersive and interactive property tours. As a result, buyers can get a detailed view of properties without stepping foot inside, saving time and effort.
Virtual reality tours are not just a trend; they're becoming a standard in the industry. With the global virtual tour market expected to reach USD 12,345.5 million by 2033, the real estate sector is set for a digital transformation. This growth is largely driven by the industry's expansion and the increasing demand for immersive experiences.
As VR technology continues to evolve, it's clear that virtual tours will play a crucial role in attracting tech-savvy buyers. The convenience and detail they offer are unmatched, making them an essential part of modern property marketing strategies.
Sources: Virtual Tour Market Size Share, Trends | CAGR of 29.3%, Indonesia's Internet Penetration Hits 79.5 Percent, Trend Continues, Why 360-Degree VR is the Next Big Thing in Social Media Marketing, Exploring the Revolution of Real Estate Virtual Tours in 2023
11) High-rise apartment demand will surge due to land scarcity driving vertical development
Jakarta's population boom has made land a rare commodity, pushing the city to build upwards.
With skyrocketing land prices in central Jakarta, developers find high-rise apartments more feasible than low-rise buildings. The government is on board too, encouraging vertical growth, especially near transit hubs, to make city travel easier.
Land scarcity is a real issue, with only 10% of green space available, far from the ideal 30%. This makes high-rise projects a smart way to use land efficiently, and you can see this in the increasing number of such developments popping up around the city.
People's tastes are changing too. More folks want the urban lifestyle that high-rise apartments offer, thanks to the convenience and amenities. The new Jakarta MRT is a game-changer, making city living even more appealing.
There's also a shift in household dynamics. More single and smaller households are looking for affordable and convenient living, which high-rise apartments provide. This trend aligns perfectly with the growing demand for these types of homes.
So, if you're considering buying property in Jakarta, high-rise apartments are where the action is. They're not just a trend; they're a response to real urban challenges and changing lifestyles.
Sources: JPI, C40, JLL Research
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12) North Jakarta will see a major interest boost from upcoming waterfront developments
North Jakarta is poised to become a hotspot due to planned waterfront developments.
One of the main drivers is the government's significant investment in infrastructure, especially the 11-kilometer coastal defense project. This is part of the National Capital Integrated Coastal Development (NCICD) Phase A, which includes a seawall and other coastal defenses. These enhancements are set to make the area more appealing for both development and investment.
Moreover, the announcement of major waterfront development projects is stirring interest. The NCICD project not only tackles flooding but also manages the northern coastal areas, ensuring sustainable development. This initiative aims to protect the area from coastal erosion, making it a safer and more attractive place to live and invest.
Real estate developers are increasingly eyeing North Jakarta. The completion of projects like Pluit Sea View (Ibiza Tower) and Cleon Park (North Tower) highlights a trend of growing development activity. These projects contribute to the existing apartment landscape, indicating that developers see significant potential in the area.
Transportation improvements are also on the horizon, with the ongoing construction of MRT phase 2A. This will enhance connectivity to North Jakarta, making it more accessible and attractive to potential residents and investors. Improved transport links are expected to boost the area's appeal even further.
Sources: Social Expat, Real Estate Asia, Smart City Jakarta
This article gives you valuable insights, but remember, it’s not and will never be investment advice. We pull data from a range of sources to provide you with the most accurate picture possible, yet we can’t guarantee complete accuracy. Markets are difficult to predict. Make sure to do your own research and consult a professional before making any financial moves. Any risks or losses are your own responsibility.