As expected the property sector of Bali is still benefitting from macro economy, buying power of the low income people kept increasing, and even an increase in the domestic investment is going as expected. At the start of the year 2013 the experts have predicted that the domestic economy will be the theme in 2013, and it will be a tough year for global economy. The brokerage had stated in its Equity Strategy outlook report for year 2013 that the real estate sector will be benefitted from the strong domestic spending.
The analysts at the brokerage have cited that the country’s inflation rate is at below 5% in last 17 months that has been a major factor to keep borrowing cost down. Benchmark policy rate of the Bank Indonesia is at the record low of 5.75% since February 2012. According to IndoPremier, Indonesia will definitely continue to become a beneficiary of these conditions in 2013. According to them the consumer sector is expected to get boost partially, because of the minimum wage raise during the last year, which was set to rise by avg. 19.8% in over 31 provinces.
According to Bali luxury resort association over 13 million workers will get the most benefit of higher minimum wages. And the wage increase is expected to spend on the foods as well as the housing and durable goods. As per the record, most of the domestic investment has been done on the mid-range properties, not on the villas and other high range properties.
The current Real Estate market trend most of the experts are saying that the secondary market is going to emerge soon, and when it happens, the sellers trying to sell the property which is not located on the prime locations will be left behind, and that will slow down the market.
With the increasing numbers of the foreign tourists, the rate of land in Bali have gone really high, especially in and around the southern part of the island, and even in the underdeveloped areas around them. This will open new area of opportunity for the developers, the areas such as kerobokan and Pererenan where the price of land is still low will be a better place for the expansion of their development projects, and it is expected that the developers will be heading to these areas very soon.
The active tourism industry of this island is complemented by the improvement of the fundamental facility of tourism market. Which includes the overhaul of new highways, Ngurah Rai Internatiional Airport, and underpasses, are still a key factor in the Bali property market and the domestic economy as well. There is still one thing missing in the real estate market of Bali, and that is the gated estate which is more noticeable and visible in the other regions of Asia, and it includes Thailand.