Home Ownership Backlog in Indonesia, Ownership of livable houses in Indonesia is still relatively small. The ratio of habitable home ownership in Indonesia has only experienced limited growth over the last five years.

Restoring the quality of economic growth after the pandemic, Indonesia continues to show growth in its macroeconomic conditions. Indonesia’s GDP has continued to increase in the last three years.

Marketing Sales Growth Trend, The development of infrastructure and government support to encourage stability and economic growth in Indonesia have increased marketing sales of property company yearly.

Stable Land Bank, The majority of property company have succeeded in maintaining the Land Bank optimally. This can be seen from the stable number of land banks in the last 5 years.

After the election is over, property sales have the potential to increase. Apart from that, based on PUPR ministry data, the ratio of livable house ownership in Indonesia will only be 57.31% in 2023.

Property Vs. Interest Rates. During the high interest rates in 2023, Home Ownership Credit (KPR) financing will still record growth, although limited.

VAT incentives. The Government will continue the VAT incentives program until 2024. This program is an incentive provided by the Government, which will cover 100% VAT on house purchases from November 2023 to June 2024 and house purchases from July–December 2024, covered by 50%.

The trend of increasing property prices and recurring income. The Residential Property Price Index (IHPR) released by Bank Indonesia in 1Q24 increased to 108.76, growing 1.89% yoy.

Most property company are still recording marketing sales growth, which aligns with each company’s FY24F targets.

With the various catalysts above, as well as the performance of each issuer in the property sector, we make our top picks BSDE, with a potential fair value of IDR 1300, CTRA, with a potential fair value of IDR 1390 , and SMRA, with a potential fair value of IDR 705 .

By PHINTRACO SEKURITAS | Research
– Disclaimer On –