Property Business Benefits – The following is an article that discusses the benefits that investors will achieve when investing in the property business.
The COVID-19 pandemic that has hit the country since three months ago, has been recorded pressing property prices, both new property and secondary property. One factor that triggers a decline in the price of new property offered by developers, one of which is the decreasing level of demand. This happened because people’s purchasing power had decreased, due to economic uncertainty caused by the Covid-19 outbreak.
The rising unemployment rate due to this crisis has also made potential customers, especially end users who have been terminated, to cancel their intention to buy new property. On the other hand, employees who are more fortunate have to postpone the purchase of new properties because they have to be on guard amid the uncertain economic conditions of the country. The reason is, even though the new normal has been implemented, it turns out that the curve for COVID-19 sufferers is actually increasing every day.
During the pandemic, there was intense pressure on the property business, including on new residential properties. According to data from Indonesia Property Watch (IPW), the sales value of new residential properties in DKI Jakarta in the first quarter of 2020 was recorded at IDR 83,230,609,980 or decreased by 33.3% on a quarterly basis (qtq).
This value is still lower than the same quarter last year, which was 24.3% on an annual basis (yoy). This is also reflected in the number of units sold, which also decreased by 37.9% (qtq) or decreased by 29.4% (yoy).
Of the total new property sales, the segment of house prices above Rp2 billion dominated 75%. Meanwhile, the composition of home sales at a price of IDR 1 billion – IDR 2 billion is 25%.
So, is now the right time for consumers or investors to buy new properties?\
Investment Opportunities in the Middle of Crisis
In Chinese, crisis is defined as “weiji”. The word weiji is a combination of two words: “wei” which means danger, while “ji” means opportunity. This word can mean that, in every threatening danger, there is always an opportunity to be had. This includes the property business, especially new properties.
Advantages of Buying New Property Now
In current conditions, the monitored developer has issued and offered many attractive purchase programs. The point is how consumers can absorb their products, while developers can play cash flow to survive. If you look at the many attractive incentives being given today, there is not necessarily a similar incentive when conditions were normal.
Here are some of the advantages of buying new property during a pandemic crisis like this:
1. Special Price
The laws of supply and demand apply to the new property market. When demand is limited, while supply is abundant, the selling price will naturally fall — or at least stagnate. In current conditions, where developers find it difficult to sell their new properties, new residential property prices are expected to fall. Indonesia Property Watch predicts that in the second quarter of 2020, new residential property prices will drop by an average of 5% – 8%.
The trend that is happening now is that many developers offer special prices (in the form of discounts or cashback) when selling their new properties. The figure can reach above 10%. For both consumers and investors, this is a golden opportunity to buy new property.
Also Read: More Profit to Buy a House or Apartment
2. Various Attractive Promotions
Buying a new property now means you have the opportunity to enjoy a variety of promotions and interesting gimmicks from the developer. This promo can be in the form of direct prizes in the form of cash or goods, down payment subsidies (DP), interest subsidies, or mortgage interest rates that are lower than market interest rates.
In addition, developers usually offer easy ways to pay, such as paid holidays. With this promo, prospective buyers can book or book the desired new property, then start paying a few months later, depending on the promo promised by the developer.
3. More Choices
With fewer enthusiasts, you certainly have more choices for new properties — whether comparing properties across multiple projects, or units in one project. For information, in a new property project, especially residential, consumers tend to choose certain units, such as a house facing a direction other than the west, choosing a house with a certain number and avoiding certain numbers that are considered unlucky, avoiding houses in the skewer area, and so on. Now, with a minimum number of potential buyers, you are more free to choose the new property unit you want.
4. High Gain Capital
Buying new property in a crisis, where the purchase price is low, you will have the opportunity to enjoy a high capital gain when the property market situation returns to normal. This is because the developer will gradually increase the price of new properties that have not been sold at this time, especially when entering the seller’s market phase.