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Rising Residential Property Prices Accelerating: BI

logo Medcom.id Medcom.id 09/05/2019 Wahyu Dwi Anggoro
The Residential Property Price Survey conducted by Bank Indonesia in the first quarter of 2019 pointed to a faster pace of rising residential property prices, as confirmed by 0.49% (qtq) growth in the Residential Property Price Index (RPPI) compared with 0.35% (qtq) in the previous period. © Wahyu Dwi Anggoro The Residential Property Price Survey conducted by Bank Indonesia in the first quarter of 2019 pointed to a faster pace of rising residential property prices, as confirmed by 0.49% (qtq) growth in the Residential Property Price Index (RPPI) compared with 0.35% (qtq) in the previous period.

Jakarta: The Residential Property Price Survey conducted by Bank Indonesia in the first quarter of 2019 pointed to a faster pace of rising residential property prices, as confirmed by 0.49% (qtq) growth in the Residential Property Price Index (RPPI) compared with 0.35% (qtq) in the previous period. 

Furthermore, respondents predicted RPPI growth to accelerate again in the second quarter of 2019 to 0.52% (qtq), edged up by rising construction material prices and higher wages.

Residential property sales reversed the previous 5.78% (qtq) contraction recorded in the fourth quarter of 2018 to increase 23.77% (qtq) in the first quarter of 2019, led by small houses with medium and large houses also posting gains.

"The latest survey also indicated that most consumers (74.16%) relied on bank financing when purchasing residential property," the central bank said in a press statement released on Thursday.

In line with rising residential property prices, housing loans disbursed by the banking industry also accelerated from 1.14% (qtq) in the fourth quarter of 2018 (December 2018) to 4.02% (qtq) in the first quarter of 2019 (March 2019).

Solid national economic growth was recorded at 5.07% (yoy) in the first quarter of 2019, pointing to maintained domestic economic performance despite retreating from 5.18% (yoy) in the fourth quarter of 2018. 

Seasonal factors at the beginning of the year as well as the impact of weaker-than-expected global economic gains contributed to the moderate economic downturn in Indonesia.

Economic growth in the first quarter of 2019 was primarily driven by domestic demand on the back of consumption by non-profit institutions serving households (NPISH) and households.

"Bank Indonesia perceives positive national economic performance against a backdrop of weaker-than-expected global economic dynamics," the central bank said in a written statement released on Monday.

Moving forward, Bank Indonesia will maintain a pro-growth policy mix oriented towards maintaining macroeconomic stability. 

In addition, the policy mix instituted by Bank Indonesia, the Government and other relevant authorities will constantly be strengthened to sustain economic growth momentum. Consequently, Bank Indonesia projects economic growth in 2019 within the 5.0-5.4% range.

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