In Jakarta, apartment supply is rapidly increasing, reaching a total of 10,232 units by the end of the first quarter of 2024. Forecasts suggest an additional influx of over 800 new units into the rental apartment segment by the end of 2025.
This uptick includes the recent opening of Park Royal Serviced Suites, adding to the city’s apartment offerings in early 2024.
Geographically, nearly half of Jakarta rental apartment supply is concentrated in its central business district (CBD), prized for its connectivity and proximity to commercial hubs.
Moreover, rental options thrive in expatriate-friendly zones like Kemang, Cilandak, and Pondok Indah in South Jakarta, boasting superior infrastructure and amenities.
These insights stem from the “Jakarta Property Market Insight Q1 2024” report, published by Leads Property in May 2024.
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According to Leads Property, rental activity has slowed post the expiration of previous year leases, compounded by the ripple effects of February’s general elections, which momentarily dampened market sentiment.
Despite these challenges, corporate short-term accommodation needs and pre-Idulfitri 2024 MICE (Meetings, Incentives, Conferences, and Exhibitions) activities continue to buoy demand.
Nevertheless, early-quarter stagnation has driven down occupancy rates to 60.85% in Q1 2024, marking a 2.6 percentage point drop from the prior quarter.
Owners responded with rental price adjustments in early 2024, particularly for high-occupancy properties.
Yet, sluggish demand prompted some owners to defer price hikes or even offer reduced rates compared to the previous year to attract tenants amidst heightened market competition.
Overall, the average rental rate in Jakarta for Q1 2024 hovered around S$20.90 per square meter per month, reflecting a modest 0.4% uptick from the previous quarter.
Looking ahead, market expectations anticipate an increase in apartment supply in the coming years, with projections suggesting at least 891 additional units entering the market by the end of 2025.
Leads Property emphasizes that while developer interest remains robust in meeting Jakarta’s rental accommodation demands, increased unit availability may intensify competition among property owners, necessitating strategic pricing approaches to appeal to prospective tenants.
