Property Prices in Indonesia

[kroshka]

Scientia is a nice place to stay. I stayed there for some months. And true it is full of students. It seems however that the mall has some problems, it getting more and more empty. Last I was there they have turned the 2nd floor into some kind of "educational floor". But there are lot of new apartment building "on the way" in that area - also in Lippo Karawaci

 

[jstar]

Re: post # 99
Thanks jstar....I think I'll keep the apartment as I'm coming to JKT on Monday to avoid Nyepi in Bali. It was bought so cheap I'm not even considering profit.
I just wondered if you had information about the building as, according to your posts, you seem to have intimate knowledge about other building's construction..
I'm starting to see some ongoing maintenance issues and the developer is the same company that should maintain the building. I think, in most countries, it is the rule that the developers are not permitted to continue with the ongoing management and is handed over to a resident's association...maybe that's a problem for Indonesia to look at if they want their property market to flourish with foreign investment.

Although I've never been in that building, I can very well imagine what is going on. Honestly, I've not experienced it any other way. (Leaks on balconies, windows not closing properly, even tiles coming off.) The building quality is subpar, it doesn't really matter how big and experienced the developer is. And a 10 year warranty as in certain other countries? Here you should be happy if it's more than 1 month.

Yes, the building management is separate although at startup the developer takes on the role.

 

[jstar]

Scientia is a nice place to stay. I stayed there for some months. And true it is full of students. It seems however that the mall has some problems, it getting more and more empty. Last I was there they have turned the 2nd floor into some kind of "educational floor". But there are lot of new apartment building "on the way" in that area - also in Lippo Karawaci

Yes but the Summarecon Digital Center (SDC) next door was never conceived to be a real traditional mall. They thought all the students would like some ITC with food court (and a fancy name) close by. There is a free shuttle bus to the SMS mall. (Which I kind of like, esp. the semi-outside food street at night.)

The (large) swimming pools and the gardens are quite nice too. Better than Taman Anggrek common areas. The reception desk is friendly and helpful, enough parking present (students don't have cars) and the 3 employees in the building management office on the ground floor do go the extra mile. Elevators are fine with the occasional hiccup. If was afraid for noise and rowdy behavior but students here really are different from where I come from.

 

[jstar]

The superblock market supply here is huge, you can imagine what 16 apartment blocks in a Meikarta will do for instance.

There is a rumor that the Meikarta project has been temporarily halted by its developer.

 

[Missnaughty]

I have just browsing the net for Bali villas. 2BR/678sqm $1M? Can I have gross income $100K a year with that?

 

[snpark]

Maybe they meant 1 milliard - $100,000 and get $10,000 a year hahaha but yeh they probably did mean $1m usd for for a 2 bed villa, sure you can get $300 a night for it, every single night of every year with not a single night missed for maintenance etc etc

I know some people who can barely rent their villa for 5 nights a month let alone 30 nights

 

[R Cameron]

I have just browsing the net for Bali villas. 2BR/678sqm $1M? Can I have gross income $100K a year with that?

Are you talking about USD? 1 million USD certainly must get you a nice place, and 678sqm is very large (esp. for a 2 bedroom?). If you did short term rentals you would need 555 USD per night if you kept it full 50% of the time (which I imagine is quite challenging at that very high end). Here's your competition: AirBnB - Bali - 500+ per night

How does the place you're looking at compare regarding location, facilities, view, etc? Are you prepared to offer the same amenities that an expensive rental like this often comes with, staff, driver, etc?

 

[snpark]

Don't forget to pay your tax too please, no illegal AirBnB rentals anymore remember, must declare it all !!

 

[dafluff]

I have just browsing the net for Bali villas. 2BR/678sqm $1M? Can I have gross income $100K a year with that?

There are a few locations in Bali that can justify that price, but not many. Without more information I couldn't begin to guess.

 

[Missnaughty]

I was just surprised to see how expensive properties in Bali. Most people if they buy in Bali, it’s for making money. Will u get ur money back after all of the cost to run the business?

 

[jstar]

Probably not otherwise they wouldn’t sell it. The ‘why’ of asking prices are a bit like why does a dog lick his scrotum; well, because he can.

And the very expensive properties, are never rented out full time, they are more suitable for vacations of the rich & famous, drug lords and large groups and parties (weddings). That means quite a lot of administration and ongoing ‘work’.

Rule of thumb; take the income of rental over 10 months, keep 2 months for repairs and costs.

So to achieve your $100K per annum, you would in fact need $120K. And 10% for rental income is quite high nowadays, if you have the cash and want to invest in RI a deposito might make more sense. Or 15 student studios in an apartment building (high building management costs!), or even a kost transformation. The problem is that many people mixup an investment with something they would like for themselves. A big mistake.

Bank interest rates in the West are low and if a property really (proven!) generates 10% it would be snapped up fast. If something looks too good to be true.....

 

[scouser59]

Bali is "as cheap as chips" at the moment for accommodation , substantial numbers of properties are up for sale because they cannot make a profit , because of low prices and occupation rates .
There may be the odd palatial properties with more staff and luxurious facilities "than you can shake a stick at" but I doubt they would achieve 50% occupancy over a year, never mind the horrendous maintenance and staff costs .
Bali is generally overbuilt , with straining and failing infrastructure , hardly "the island of the gods" .

 

[Fred]

so what is driving these prices?

Bent estate agents that make a lot of money out of the misery of everyone else.
Any other questions?

 

[Daniel50]

Bent estate agents that make a lot of money out of the misery of everyone else.
Any other questions?

I am not sure what you mean? There has to be enough money floating around? I have read about your frugality.

 

[Daniel50]

Bali is "as cheap as chips" at the moment for accommodation , substantial numbers of properties are up for sale because they cannot make a profit , because of low prices and occupation rates .
There may be the odd palatial properties with more staff and luxurious facilities "than you can shake a stick at" but I doubt they would achieve 50% occupancy over a year, never mind the horrendous maintenance and staff costs .
Bali is generally overbuilt , with straining and failing infrastructure , hardly "the island of the gods" .

I know you seem to be talking about commercial properties above but I hope there are deals on residential properties in the future. Who knows the future but overbuilding without enough demand may make for good deals if someone wants to buy.

 

[scouser59]

I know you seem to be talking about commercial properties above but I hope there are deals on residential properties in the future. Who knows the future but overbuilding without enough demand may make for good deals if someone wants to buy.

The place next door to me sold for 60% off asking price , still too much imho , junk construction like most here , now the poor buyer is spending the same again on reno , more money than sense ,.

 

[Fred]

I am not sure what you mean? There has to be enough money floating around? I have read about your frugality.

Well, house prices and rents are higher than the majority of working Indonesians can afford, thus normal market forces are not at work.
The only explanation is agents are forcing the prices up and up so, whilst they get the same percentage, the prices are higher so they make more cash.

 

[scouser59]

Well, house prices and rents are higher than the majority of working Indonesians can afford, thus normal market forces are not at work.
The only explanation is agents are forcing the prices up and up so, whilst they get the same percentage, the prices are higher so they make more cash.

or corruption ?

 

[snpark]

A property is only worth what someone else pays for it. Valuations mean nothing. I'm a multi millionaire on paper if you pay me what I think my properties are worth. Sadly the market has lowered my worth and self esteem hahaha

 

[scouser59]

A property is only worth what someone else pays for it. Valuations mean nothing. I'm a multi millionaire on paper if you pay me what I think my properties are worth. Sadly the market has lowered my worth and self esteem hahaha

Im a multi millionaire also ,but only in rupiah