Monday, February 09, 2009

Changing skyline Time to get back to the city?

Matheos Viktor Messakh , The Jakarta Post , Jakarta | Sat, 02/07/2009 1:06 PM | Lifestyle
In between: A man reads ads for apartments during a property expo in Jakarta. (JP/ Ricky Yudhistira)In between: A man reads ads for apartments during a property expo in Jakarta. (JP/ Ricky Yudhistira)
Jakarta's skyline is changing. Many billboards advertise great apartments - smartly themed they sell ideas of romantic rhythms to tropical paradises. In five years time, will the skyline be full of glittering towers?
Probably. But many simply do not care about the affect this will have on the city's worsening traffic and environment.
Novita Imelda finds living in apartment suits her needs.
She actually bought a house in a township in Tangerang back in 1999 but when she got married six years later, they bought an apartment in Central Jakarta as it was closer to their places of work.
She said that before buying the apartment she and her husband used to spend two to three hours a day traveling back and forth between their working places in Sudirman in Central Jakarta and Slipi in West Jakarta.
"Now it only takes 15 minutes for me and five minutes for my husband to get to work," said the mother of one, brimming with joy.
The young family found living in apartment more practical, efficient and safe, although it costs them more than buying a house. They first bought a studio and when the baby came, they bought a three-bedroom apartment.
"Of course it's more expensive. with the same price, we could buy a good house," Novita said. "But an apartment is more practical and easier to maintain."
Home sweet home: Two women checkout the interior design of an upscale apartment in Sudirman area, Central Jakarta (JP/ P.J. Leo)Home sweet home: Two women checkout the interior design of an upscale apartment in Sudirman area, Central Jakarta (JP/ P.J. Leo)
In the past, many people shied away from staying in high-rise buildings, preferring to live in houses.
But with bad traffic and the cost of building or buying a house continuing to escalate, people have started to change their minds and reconsider their options.
In the last few years, more and more people, mostly professionals and executives, cannot resist the temptation of living closer to their workplaces - enabling them to escape being trapped for hours in traffic, spend quality time with their loved ones or simply enjoy more "me time".
"People are willing to pay more as long as they get what they want, especially for those with a good career.," Evi Susanti, Associate Director of PT Procon Indah, a Jakarta-based property consultancy, said
Over the past three years, more apartments are being built for the middle- and lower-income segments with the price tags are between Rp 200 and Rp 400 million.
For those who prefer to rent, the prices range from Rp 2 million up to Rp 5 million per month.
The hassle of endless traffic jams has seen the construction of many apartment buildings close to prime business districts.
"They never build far away from Jl. Sudirman, Jl. Rasuna Said, Jl. Thamrin or Jl. Gatot Subroto. These are where the concentration of the projects have been within the last five years."
Data from Procon shows that from 2004 to mid 2007, the number of apartments has grown by 60.4 percent, as demand grew by 67.8 percent.
Procon's market review showed that in the fourth quarter of 2008, the cumulative supply for condominiums in Jakarta reached 65, 260 units, with an annual availability of 8,400.
Although analysts anticipate that, due to the current global financial crisis, the property business will be sluggish within the next two years, but insist that property is a safe investment, as there is stable demand from the upper-middle class for property in strategic locations.
Beside the distance to workplaces, Procon's latest research shows that the size and number of bedrooms, facilities offered, the architecture style and payment scheme on an apartment are also top considerations.
Almost 50 percent of residents own their apartment at use it as their first house, up to 20 percent use their apartment as their second house or a house for their extended family members and more than 30 percent rented them.
Despite the crisis, developers are still frantically trying to come up with seductive marketing strategies including offering flexibility of payment terms.
"Attractive payment schemes are one of the reasons why many executives and professionals are willing to buy an apartment rather than renting a room or a house.," Evi said.
Before interest rates increased in October last year, most buyers used bank loans to buy but the crisis has made many developers change their strategy, offering blunt payments to accommodate the demand of market.
"After October 2008, we advised our clients to reshape their payment schemes. Smart developers are usually responsive to market need or nobody will buy."
The relatively steady prospects for property investments attract the buyers who just want to use their apartment as a rental property.
"Buying a house outside the city will take a long time to sell back for profit. It might be sold at a loss if you're in hurry, but buying an apartment and selling it back in four or five years, you might gain more than 50 percent in profit."
With such a picture in mind, returning back to the city might seem like a good choice.

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