As more developers and banks offer programs to make housing more affordable for millennials, owning your own home at a young age is becoming less of a dream. (Photo courtesy of Setiawan Dwi Tunggal)
Owning Your Own Home at a Young Age, Why Not?
JUNE 21, 2019
Jakarta. Developers and banks are now competing with each other to offer programs that can make housing more affordable for millennials. Owning your own home at a relatively young age may soon become less of a dream than a real possibility.
Data from Bank Indonesia, the central bank, have shown an increasing number of debtors between the ages of 26 and 35 since 2014. Millennials within that age group have been mortgaging both landed houses and flats of up to 70 square meters.
Young debtors started dominating the market for apartments in 2018. They now make up 35 percent of total mortgage borrowers.
The data indicate millennials make up a strong target market in the housing sector. Unfortunately, access to mortgage is still restrictive: only 40 percent of Indonesian millennials have it.
Two main things stand in the way between millennials and home ownership: low purchasing power from a stagnant income and a highly mobile lifestyle that prioritizes entertainment over investment.
To improve home ownership rate among millennials and to make it easier for younger generations to save and invest for their future, Setiawan Dwi Tunggal, the developer of The Parc apartment in Tangerang, has invented a program called Nabung DP that allows millennials to pay the down payment on their apartement mortgage at The Parc in two- or three-year installments.
SouthCity project director Peony Tang said Nabung DP will allow a 20 percent down payment paid in 24 installments of up to Rp 3.3 million ($231) each. An apartment mortgage would also set young home owners back around Rp 3 million per month, which means they would only need to set aside Rp 99,000 a day.
Despite their affordability, all The Parc apartments offer five star-equivalent facilities, including a co-working space with free Wi-Fi that should suit millennials' penchant to get social.
"The Parc has multi-function halls, clubhouses, a gym, an Olympic-size pool, a one-kilometer jogging track and a badminton court, among other things. We also have many community events in our calendar," Peony said.
For highly mobile millennials, The Parc's close proximity to new MRT stations in Lebak Bulus and Fatmawati, Transjakarta stations and toll roads should give them a peace of mind.
The Parc is the first vertical housing complex in the SouthCity project, which is being built on a 1.5-hectare piece of land in the south of Jakarta by Setiawan Dwi Tunggal. It is also the first co-living housing complex in Indonesia.