The demand for rental apartments in Indonesia is surging, driven by a growing expatriate population. This trend is particularly noticeable in the SCBD area, where the influx of expatriates is causing rental prices to rise sharply. Since 2023, rental costs for expatriate residences have surged, with some increases reaching up to 30%.
The expatriate community in Indonesia is well-established, with the number of expatriate workers reaching 96,570 as of May 2022. This significant presence underscores the appeal of expatriate professions in the country.
As the number of foreign workers continues to grow, the need for housing is also on the rise. This heightened demand has led to a notable increase in rental prices, especially in sought-after areas like the CBD.
Colliers Indonesia reports that, despite a rental price increase in the second quarter of 2024, the rise has been modest. “The increase in apartment rental prices in the CBD is only around 2 to 3 percent, so it remains relatively modest,” said Ferry Salanto, Head of Research at Colliers Indonesia. Currently, rental prices for apartments in the CBD stand at IDR 464,453 per square meter, reflecting a rise from the previous year.
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Looking ahead, rental prices are projected to continue climbing by 1 to 2 percent through the end of 2024, driven by potential increases in supply. Additionally, the occupancy rate for rental apartments has risen to 58.2 percent, a slight improvement from the previous quarter’s 56 percent.
“At the beginning of the year, the market is usually slow and only starts moving in the second quarter. This occupancy rate is contributed by short-stay guests,” Ferry explained.
He also revealed that four new rental apartment projects, totaling 719 units, are expected to hit the market between this year and 2025, which may help address some of the housing demand.
With the expatriates in SCBD area continuing to expand, the rental market in Indonesia remains dynamic and increasingly competitive.
