How will Jakarta Property Business become if the Capital City Moves?
The plan of moving the capital city from Jakarta to a more appropriate location has become hot topic recently after President Joko Widodo held a special meeting session in the presidential palace on last Monday April 29th, 2019. This capital moving issue has raised some queries, one of them being “How is the impact of such policy to Jakarta property business?”
Managing Director of Lamudi.co.id, Mart Polman, explained that the plan could give positive impact to property business in Jakarta because even though it may not be the capital anymore Jakarta will stay as economy center and therefore property market activities will not be disturbed by political and governmental issues.
Head of Research and Consultancy Savills Indonesia, Anton Sitorus, also agrees. He said that, with the government activities being moved out, Jakarta’s burden such as traffic problem will somehow lessen. This can be more attractive to the property investors. With the improvement of city’s convenience and beauty, the demand of properties in that city will certainly increase which in the end could drive a faster price growth.
The Ministry of National Development Planning / National Development Planning Bureau (BAPPENAS) estimates there are 1.5 million state employees or civil servants that will move out of Jakarta to the new capital. This of course will decrease the population and will lessen the traffic in Jakarta. However, BAPPENAS is still unable to predict how big the impact will be to the property price in Jakarta. They think the impact will be unavoidable, but most certainly it will be gradually and in the long period of time.
BAPPENAS explains that the increase of property price in Jakarta will not happen immediately after the capital moves to another location. There are some other things that will affect the property price such as facility improvements in the city itself.
The Minister of PPN / Head of BAPPENAS, Bambang Brodjonegoro, also said that the relocation of the capital city from Jakarta will not necessarily affect Jakarta’s property price. He is quite sure of that because Jakarta will stay as the biggest business, financial and service capital of Indonesia and therefore will still stay attractive to the property players.