West Java Property Sales Face Challenges Amidst Declining Purchasing Power and Rising Costs

The property market in West Java, Indonesia, is grappling with a challenging year, marked by a substantial decline in public purchasing power and the adverse effects of a strengthening US dollar against the Rupiah. These economic pressures have directly impacted the construction sector, driving up the prices of building materials.

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The causes for the sales decline, first and foremost, is purchasing power. Public purchasing power has actually been declining for a year. Starting from early 2025, deflationary conditions have occurred in our country. Even now, with the dollar rising, and what do you call it, construction materials too. When the dollar rises, construction materials rise.

According to Norman Nurdjaman, Chairman of the West Java chapter of Real Estate Indonesia (REI), property sales have plummeted by an estimated 30 to 40 percent compared to the previous year. He attributes this downturn primarily to weakened consumer spending, a trend that has been evident since last year and was further compounded by deflationary conditions at the start of 2025. The rising dollar has also increased the cost of imported construction components, such as door handles, and has led to a surge in prices for locally sourced materials due to a moratorium on mining operations in areas like Cirebon following a landslide disaster.

Nurdjaman described the current economic climate as stagflation, a precarious situation where deflation and inflation occur simultaneously, inevitably impacting public income and reducing business profits. In response to these challenges, REI West Java is focusing on enhancing the marketing capabilities of its members by conducting digital marketing training. This initiative aims to equip sales teams and content creators with the necessary skills to navigate the evolving market through social media engagement.

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That increase in prices has caused inflation. Currently, the condition is also in a state of stagflation. That is, deflation and inflation are occurring simultaneously, which is a condition that is very avoided in a country or region because, as mentioned, the impact is that everyone's income will definitely decrease. If it decreases, profit decreases, income decreases.

Despite the current difficulties, Nurdjaman highlighted the significant housing demand in Indonesia, estimated at 15 million units nationally, or 10 million according to government figures. West Java alone accounts for at least 20 percent of this demand, representing approximately 2 million housing units. He believes this substantial available market makes the target of developing 350,000 units a realistic goal for developers, provided they can overcome the obstacles, including issues related to the SLIK OJK credit scoring system that often hinders potential buyers.

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So, we are equipping REI Jabar members, content creators, marketers, with, yes, increasing insight, then techniques related to social media.