Licensing Become Dominant Factor of Domestic Industrial Property Sluggish

INDUSTRY.co.id - Jakarta, DKI Jakarta Real Estate Region Board of Directors said, based on surveys conducted in the period February to April 2018, the developers REI predict the property industry will stagnate this year.

Jakarta DPD REI Chairman Amran Nukman explained that 55 percent of developers of REI members of DKI Jakarta stated that the property condition of 2018 will remain the same compared to the previous year. While the other 34 percent optimistic property conditions 2018 better.

"Of the overall, the majority still plans to develop simple housing, upper middle and apartments, with priority needs of infrastructure in the form of clean water and roads," he said in the Office of DPD Jakarta (23/5/2018).

Amran explained, the stagnation is mainly affected by government policy, namely taxation, licensing, credit interest rates. Especially in DKI Jakarta licensing is still a challenge in itself.

"Bureaucracy is the most dominant factor in influencing the licensing process, as 69 percent of respondents said it is easier to obtain permits outside of Jakarta than in Jakarta," he said.

This, he added, is exacerbated by Indonesia's macro conditions, especially as the weakening of the rupiah against the US dollar and the rise in Bank Indonesia reference rates. These conditions clearly put pressure on the real estate business developers.

"However, developers and property market should remain optimistic that the 2018 condition will improve," he said.

Even so, he said, developers are still optimistic in 2018 will be a brilliant year for the real estate industry. Because according to him, the majority of developers, which amounted to 32 percent see though 2018 a lot of pressure but their concern to develop is the market competition.

"We thought that the purchasing power of the people, in fact, is small, the location financing is not a problem, so the biggest competition is the market," he said.