Jakarta. Indonesia needs to provide a centralized and updated database on land and asset sales if it wants to develop a more robust residential market, the latest report by property consultancy Jones Lang LaSalle revealed.
"While the region as a whole has shown improvement, most countries in Asia Pacific are still not transparent," Jones Lang LaSalle Asia Pacific head of research Jane Murray said in a statement on Thursday (30/06).
The property consultancy ranked Indonesia 45th out of 109 countries in its biennial Global Real Estate Transparency Index, placing the country in the so-called semi-transparent category alongside Thailand, the Philippines and South Korea.
Indonesia has improved its score to 2.69 from the previous 2.85, with 1 indicating very high transparency and 5 indicating an opaque market. The country stays as a semi-transparent market but has slipped from the 39th place in the previous report. The previous report rated only 102 countries.
This year has been an interesting so far for the Indonesian property sector, hence the improved score.
The House of Representative passed into law in February the public housing savings bill, which will provide a funding scheme for low-income earners to buy subsidized housing. Indonesia also announced a revision of the loan-to-value regulation recently, which will allow future homeowners to buy houses with lower down-payments.
These measures are in addition to the ongoing government-backed mortgage scheme for low-income earners, which offers a flat interest rate for up to 20 years.
"There are ongoing examples of poor corporate governance, opaque and corrupt practices and failures in regulatory enforcement that are resulting in serious consequences for society, for business activity and for investment," Murray said.
According to the report, the Asia-Pacific region is home to both one of the most transparent real estate markets (Australia) and one of the most opaque (Myanmar).
"Southeast Asia has the widest variation between the highest and lowest scoring countries," Jones Lang LaSalle Southeast Asia research head Chua Yang Liang said.
Chua noted that the wide divergence in economic and urban growth in the region was the culprit behind the wide variation.
The index is based on both quantitative market data and information gained through a survey by Jones Lang LaSalle's global business network and Lasalle Investment Management across 109 markets in 2016.