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Medan's residential property market has experienced extraordinary price growth in 2025, with landed houses averaging a remarkable 67.8% annual increase and apartments surging 47.7%. This dramatic acceleration represents a significant shift from the historically modest 1-2% annual growth rates seen over the previous five years, driven by infrastructure development, foreign investment, and urbanization pressures.
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Medan's property market has transformed dramatically in 2025, with residential prices experiencing unprecedented growth rates of 67.8% for houses and 47.7% for apartments after years of modest increases.
The market is supported by strong infrastructure development, growing urbanization at 1.6-1.7% annually, and increasing foreign investment interest, particularly in high-end city center properties.
| Property Type | Current Avg Price (IDR/sqm) | Annual Growth Rate | Rental Yield |
|---|---|---|---|
| City Center Apartments | 27.1 million (~$1,653) | 47.7% | 4-6% |
| Landed Houses | 9.8 million (~$598) | 67.8% | 4-6% |
| Townhouses | 7.8 million (~$476) | Varies by location | 4-5% |
| Premium District Condos | Up to $1,900/sqm | Above average | 5-6% |
| Commercial Properties | Varies significantly | Moderate growth | 4-5% |
What has been the average annual price growth rate for residential properties in Medan over the past five years?
Medan's residential property market has experienced a dramatic transformation in pricing patterns over the past five years.
From 2019 to 2023, residential properties in Medan maintained relatively modest growth rates, typically ranging between 1-2% annually. This steady but unremarkable performance was consistent with many secondary Indonesian cities during this period. However, the market dynamics shifted dramatically in 2024-2025.
As of September 2025, the most recent 12-month period has seen extraordinary price acceleration. Landed houses in Medan have recorded an average annual increase of 67.8%, while apartments have surged by 47.7%. These growth rates represent a complete departure from historical norms and far exceed national averages for Indonesian secondary cities.
The cumulative effect over the full five-year period shows an average that has been significantly skewed upward by the recent surge, though the historical base remained relatively stable until this recent acceleration. This pricing trajectory has been driven by increased infrastructure investment, foreign capital inflows, and urbanization pressures concentrated in the city center and premium districts.
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How many new housing units were launched in Medan last year, and how does that compare with the previous three years?
The exact number of new housing units launched specifically in Medan during 2024 is not publicly disclosed in detailed municipal records.
However, national data indicates that over 220,000 new subsidized housing units were distributed across Indonesia in 2024, with Medan receiving a proportional allocation based on its population and development priorities. The trend in Medan has been toward increased high-rise residential launches, particularly in the city center, reflecting land scarcity and urbanization pressures.
Comparing with the previous three years (2021-2023), the pace of unit launches in Medan has accelerated significantly. Pre-2023 volumes were considerably lower, with most development focused on suburban landed housing projects. The shift toward vertical development has intensified since 2023, with multiple high-rise residential towers breaking ground in central Medan districts.
This acceleration in housing unit launches reflects both developer confidence in the market and government infrastructure initiatives that have made central Medan more attractive for residential development. The focus has shifted from quantity to quality, with newer projects featuring premium amenities and targeting both end-users and investors seeking rental income opportunities.
What is the current average price per square meter for apartments and landed houses in Medan, and how does it differ across districts?
Medan's property pricing structure varies dramatically between property types and districts, with premium locations commanding substantial premiums over suburban areas.
| Property Type & Location | Average Price (IDR/sqm) | USD Equivalent | District Premium |
|---|---|---|---|
| City Center Apartments | 27.1 million | ~$1,653 | Base premium location |
| Premium District Condos | Up to 31.2 million | ~$1,900 | 15-20% above city center |
| Suburban Apartments | 18-20 million | ~$1,100-1,220 | 30-35% below city center |
| Landed Houses (Average) | 9.8 million | ~$598 | Varies by specific area |
| Townhouses | 7.8 million | ~$476 | Lower-cost alternative |
| Premium Residential Areas | 15+ million | ~$915+ | Up to 50% premium |
| Outer Suburban Houses | 5-7 million | ~$305-427 | 50-60% below average |
How many property transactions were recorded in Medan last year, and what percentage change does that represent year-on-year?
Specific transaction volume data for Medan is not published in detailed municipal records, but national trends provide insight into local market activity.
Indonesia's property transactions nationally increased by approximately 10% in 2024, with financing transactions (mortgages and apartment purchase loans) growing by 60%. Medan's transaction growth has outpaced these national averages due to speculative investment activity and strong end-user demand driven by infrastructure development and urbanization.
Based on market indicators such as price growth rates, developer activity, and financing volumes, Medan likely experienced transaction growth in the 15-25% range year-on-year in 2024. This estimate is supported by increased marketing activity from major developers, rising mortgage application volumes from local financial institutions, and the acceleration of high-rise project launches.
The transaction growth has been particularly concentrated in apartment sales in central Medan and landed house purchases in emerging suburban developments. Foreign investor participation, while still legally restricted, has contributed to premium segment transaction volumes through permitted investment structures.
What is the current rental yield for apartments and landed houses in Medan, and how does it compare with national averages?
Medan's rental yields remain competitive within the Indonesian property market, offering attractive returns for both apartment and landed house investors.
Apartments in Medan currently generate rental yields in the 4-6% range, with city center properties typically achieving the higher end of this spectrum due to strong demand from professionals and expatriates. Landed houses produce similar yields of 4-6%, with variations based on location, property condition, and tenant demographics.
These yields position Medan slightly above Indonesia's national city average, though they trail premium locations such as Jakarta's central business district or popular areas in Bali. Commercial properties in Medan generate rental yields of 4-5%, reflecting steady demand from businesses attracted by the city's growing economy and infrastructure improvements.
The yield attractiveness has been maintained despite significant price appreciation, indicating strong rental demand growth that has kept pace with property value increases. This balance suggests a healthy market dynamic where both capital appreciation and rental income contribute to total investment returns for property owners.
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What is the vacancy rate for apartments and commercial properties in Medan, and how has it changed in the last two years?
Medan's vacancy rates are not published in detailed municipal statistics, but market indicators suggest moderate vacancy levels across both residential and commercial segments.
For apartments, the rising supply of high-rise towers in the city center has created some vacancy pressure, particularly for older properties that compete with newly completed developments. However, strong demand from urban migration and foreign residents has helped absorb much of the new supply. Current vacancy rates for apartments are estimated to be in the moderate range, higher than during the supply-constrained period of 2021-2022 but manageable given continued demand growth.
Commercial properties show similar moderate vacancy patterns, with older office buildings experiencing higher vacancy as businesses migrate to newer mixed-use developments and premium office spaces. The focus on modern, amenity-rich commercial properties has created a two-tier market where prime locations maintain strong occupancy while secondary properties face increased vacancy pressure.
Over the past two years (2023-2025), vacancy rates have gradually increased as new supply has come online faster than absorption, but this trend is considered part of a natural market rebalancing rather than a concerning oversupply situation. Infrastructure improvements and population growth continue to support underlying demand for both residential and commercial space.
What is the average time on market for residential properties in Medan before they are sold, and how does this compare with Jakarta or Surabaya?
Specific time-on-market data for Medan residential properties is not published in accessible municipal or industry reports.
However, the sustained price growth and strong rental demand in Medan suggest that properties generally sell faster than in slower regional markets across Indonesia. The 67.8% price growth for landed houses and 47.7% for apartments indicates strong buyer demand that typically correlates with shorter marketing periods.
Compared to Jakarta and Surabaya, Medan likely experiences competitive time-on-market periods, though Jakarta's broader inventory and more diverse buyer pool may result in varied marketing periods depending on property type and price segment. Surabaya, as another major secondary city, probably has similar dynamics to Medan, with well-priced properties moving relatively quickly in the current market environment.
The infrastructure development, foreign investment interest, and urbanization pressures in Medan have created market conditions where appropriately priced properties attract buyer interest relatively quickly, particularly in the city center and emerging premium districts where demand has been most concentrated.
What percentage of Medan's property buyers are local residents, domestic investors, and foreign investors?
Medan's property buyer composition reflects Indonesia's legal framework that restricts foreign ownership while allowing significant domestic investment activity.
The majority of Medan property buyers are local residents, comprising an estimated 60-70% of total transactions. These buyers are primarily purchasing properties for personal use, including first-time homebuyers, families upgrading their housing, and local professionals seeking apartments closer to business districts.
Domestic investors from other Indonesian cities represent approximately 20-25% of buyers, attracted by Medan's infrastructure development prospects, relatively affordable pricing compared to Jakarta, and strong rental yield potential. Many of these investors are from Jakarta, Surabaya, and other major Indonesian cities seeking geographic diversification in their property portfolios.
Foreign investors comprise a smaller but growing segment, estimated at 5-15% of buyers, with particular concentration in high-end city center apartments. These investors utilize permitted legal structures and often focus on premium properties that offer the strongest rental yields and capital appreciation potential. The foreign buyer segment has been increasing as infrastructure improvements and economic development make Medan more attractive to international investors.
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What is the current mortgage interest rate in Indonesia, and how has it impacted housing affordability in Medan?
Indonesia's current mortgage interest rates range between 6.00% and 6.25% as of 2024-2025, representing a modest increase from previous periods.
This slight rise in borrowing costs has been partially offset by wage growth and improved financing accessibility, particularly for middle and upper-middle-income buyers in Medan. Indonesian banks have maintained relatively competitive lending conditions, and government programs continue to support homeownership through subsidized financing schemes.
The impact on housing affordability in Medan has been mixed. While higher interest rates increase monthly payment burdens, the city's economic growth and infrastructure development have supported income growth that helps maintain purchasing power for many buyers. However, the dramatic price increases of 67.8% for houses and 47.7% for apartments have created affordability challenges that exceed the impact of modest interest rate increases.
For investment buyers and upper-income purchasers, the current interest rate environment remains manageable, and strong rental yields help offset carrying costs. First-time homebuyers and middle-income families face greater affordability pressure, primarily due to rapid price appreciation rather than financing costs alone. The government's subsidized housing programs continue to provide alternatives for qualifying buyers seeking more affordable entry points into homeownership.
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How many infrastructure projects such as new roads, public transport expansions, or airports are planned or under construction in Medan, and what is their expected completion timeline?
Medan is undergoing significant infrastructure transformation with multiple major projects planned or under construction across transportation and urban development sectors.
The Bus Rapid Transit (BRT) system expansion represents one of the most significant public transport improvements, with routes planned to connect major residential areas to the city center and business districts. Airport improvements at Kualanamu International Airport continue to enhance Medan's connectivity to domestic and international destinations, supporting both business activity and tourism.
Extensive new road construction and upgrades are underway throughout the metropolitan area, focusing on reducing traffic congestion and improving connectivity between suburban residential areas and employment centers. These road projects include both arterial highway improvements and local street network enhancements designed to support growing residential development.
Most of the major infrastructure projects are scheduled for completion during 2025-2027, with some extending into 2028. The concentration of completion dates in this timeline creates significant potential for property value appreciation as improved connectivity and accessibility enhance the attractiveness of various districts throughout Medan. These infrastructure investments particularly benefit areas that will gain improved access to the city center and major employment hubs.
What is Medan's population growth rate, and how is urbanization influencing housing demand in the city?
Medan's urban population is growing at an annual rate of 1.6-1.7%, reflecting steady urbanization trends and economic migration to North Sumatra's largest city.
This population growth rate significantly exceeds Indonesia's national average and creates consistent upward pressure on housing demand. The growth is driven by both natural population increase among existing residents and in-migration from surrounding rural areas and smaller cities seeking employment and educational opportunities in Medan.
Urbanization is driving demand for both homeownership and rental accommodation, particularly in inner-city districts where proximity to employment and services commands premium pricing. The trend has been especially pronounced for apartment living, as newcomers to the city often prefer rental accommodation initially and families seek properties that offer urban amenities and convenient access to schools and business districts.
The urbanization influence has been most visible in the shift toward high-rise residential development and mixed-use projects that combine residential, commercial, and office space. This demand pattern supports the strong price growth experienced in 2024-2025 and suggests continued pressure on housing supply, particularly in well-located areas with good infrastructure access. The population growth also supports long-term rental demand that underpins attractive investment yields for property owners.
What do major property developers and real estate agencies forecast for Medan's housing price growth and transaction volumes in the next 12 to 24 months?
Major property developers and real estate agencies maintain optimistic forecasts for continued strong performance in Medan's residential market over the next 12 to 24 months.
Industry forecasts anticipate continued robust price growth, though at more moderate levels than the extraordinary 67.8% and 47.7% increases seen in the most recent period. Developers expect price appreciation to remain well above historical averages, particularly for apartments and townhouses in prime and emerging districts, assuming continued macroeconomic stability and infrastructure project completion.
Transaction volume growth is forecast to remain strong, supported by infrastructure improvements that enhance property accessibility, continued foreign investment interest, and domestic buyer demand from both end-users and investors. The completion of major infrastructure projects during 2025-2027 is expected to provide additional momentum for transaction activity.
Specific market segments receiving the most optimistic forecasts include city center apartments, mixed-use developments, and residential properties in areas benefiting from new infrastructure connections. Developers are particularly confident about premium district performance, where limited land availability and strong demand fundamentals support continued appreciation. The outlook assumes continued political stability and completion of planned infrastructure investments that underpin the positive market dynamics driving current performance.
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Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Medan's property market represents a compelling opportunity for both investors and residents, with unprecedented price growth supported by infrastructure development, urbanization, and increasing foreign interest.
The combination of strong rental yields, population growth, and major infrastructure projects scheduled for completion through 2027 creates favorable conditions for continued market strength, though potential buyers should carefully consider affordability impacts from recent price appreciation.