Market Overview
| Study Period | 2019 - 2030 |
|---|---|
| Base Year For Estimation | 2024 |
| Forecast Data Period | 2025 - 2030 |
| Market Size (2025) | USD 66.74 Billion |
| Market Size (2030) | USD 86.98 Billion |
| Growth Rate (2025 - 2030) | 5.44% CAGR |
| Market Concentration | Medium |
Major Players
*Disclaimer: Major Players sorted in no particular order Image © Mordor Intelligence. Reuse requires attribution under CC BY 4.0. |
|
Indonesia Real Estate Market Analysis by Mordor Intelligence
The Indonesia Real Estate Market size is estimated at USD 66.74 billion in 2025, and is expected to reach USD 86.98 billion by 2030, at a CAGR of 5.44% during the forecast period (2025-2030). Continuous infrastructure spending, the presidential target of 8% annual GDP growth, and the ongoing 3 million houses program are the chief tailwinds behind this up-cycle. Progress on 153 National Strategic Projects worth USD 128.6 billion is strengthening logistics corridors and lifting demand for both residential and commercial assets. Cement offtake climbed to 28.542 million tons in 2024, confirming that construction momentum remains intact. At the same time, VAT exemptions on units priced up to IDR 5 billion and a recent 25 basis-point rate cut to 5.75% are assisting mid-income families in closing housing transactions[1]Ministry of Public Works and Housing, “Budget Allocation for the 3 Million Houses Program 2025,” Ministry of Public Works and Housing, pu.go.id.
Key Report Takeaways
- By property type, Residential held 56.7% of the Indonesia real estate market share in 2024, while Commercial properties are projected to expand at a 5.98% CAGR to 2030.
- By business model, the Sales segment accounted for 70.1% of the Indonesia real estate market size in 2024; the Rental segment is advancing at a 6.31% CAGR through 2030.
- By end-user, Individuals & Households represented 61.2% of the Indonesia real estate market in 2024, whereas Corporates & SMEs are forecast to post the fastest 6.12% CAGR.
- By geography, DKI Jakarta led with 31.8% revenue share in 2024; East Java is the fastest-growing region at 6.61% CAGR through 2030.
Indonesia Real Estate Market Trends and Insights
Drivers Impact Analysis
| Driver | ( ~ ) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
|---|---|---|---|
| Growing middle-income population increasing demand for housing across urban centers | +1.2% | National, with concentration in Jakarta, Surabaya, Bandung | Medium term (2-4 years) |
| Ongoing urbanization fueling vertical development in major cities like Jakarta and Surabaya | +1.0% | Jakarta, Surabaya, Medan, Makassar | Long term (≥ 4 years) |
| Infrastructure improvements such as MRT, toll roads, and airports enhancing real estate accessibility | +0.8% | Java corridor, Kalimantan (IKN), Sumatra toll network | Long term (≥ 4 years) |
| Affordable housing initiatives encouraging development in low- and mid-income segments | +0.7% | National, with rural emphasis in outer islands | Short term (≤ 2 years) |
| Foreign investment interest rising in commercial, logistics, and tourism-related real estate | +0.6% | Jakarta, Bali, Batam, major industrial zones | Medium term (2-4 years) |
| Expansion of e-commerce and retail networks boosting demand for warehousing and retail spaces | +0.5% | Java industrial corridor, major port cities | Short term (≤ 2 years) |
| Source: Mordor Intelligence | |||
Understand The Key Trends Shaping This Market
Download PDF
Growing Middle-Income Population Drives Urban Housing Demand
Household income growth and a projected 5.2% national GDP expansion in 2025 are enlarging the addressable buyer pool in core cities. The Indonesia real estate market is benefiting directly from the central bank’s latest rate trim to 5.75%, which lowers mortgage servicing costs for first-time purchasers. VAT relief on homes priced at or below IDR 5 billion further narrows the affordability gap, effectively unlocking latent demand across Java’s urban corridors. Analysts expect listed developers’ equity valuations to firm as this purchasing power filters through pre-sales. Policy makers underscore housing’s dual economic and social role, citing the sector’s capacity both to lift construction-sector employment and to narrow poverty levels.
Urbanization Accelerates Vertical Development in Major Cities
Indonesia’s urban population continues to climb, pushing developers toward high-rise formats on limited urban land. Cement demand in Kalimantan jumped 18.8% in 2024, mirroring the construction pace of Nusantara, the planned new capital. Government capex of USD 3 billion through 2029 underpins this transformation. Projects such as Mitsubishi Estate’s Two Sudirman towers—set to reach 330 m and 270 m by 2028—illustrate how investors are responding to density pressures. These trends position vertical living as the default solution for future urban growth within the Indonesia real estate market.
Infrastructure Development Enhances Real Estate Accessibility
Completed toll-road mileage reached 2,816 km by January 2024, linking Sumatra, Java, and Sulawesi more seamlessly. The Cimanggis-Cibitung corridor alone absorbed USD 683.9 million, shortening commutes across Greater Jakarta and immediately lifting adjacent land values. In Bali, a USD 20 billion subway will connect Ngurah Rai Airport to Ubud by 2028, expected to re-rate tourism nodes once operational. Aviation projects such as Bandara Dhoho Kediri (USD 567.7 million) are likewise opening secondary cities to wider investor interest, broadening the spatial reach of the Indonesia real estate market[2]Sekretariat Negara, “Progress of National Strategic Projects and Operational Toll-Road Length 2024,” Sekretariat Negara, setneg.go.id.
Affordable Housing Initiatives Stimulate Low-Mid Income Development
Affordable housing continues to be a cornerstone for improving living standards and fostering economic growth. In 2025, the "3 Million Houses" initiative is set to invest USD 327.6 million, aiming for 2 million homes in rural areas and 1 million apartments in urban locales. To bolster this endeavor, the state-owned Bank Tabungan Negara is offering tailored mortgage solutions. Fitch Ratings highlights that homes priced under IDR 2 billion ( USD 122,000 ) are poised to drive consistent sales in 2025. Developers embracing modular construction not only reap cost benefits but also tap into green-building incentives, positioning themselves for significant growth in this segment. These efforts underline the importance of collaboration and innovation in addressing housing needs for low to mid-income groups.
Restraints Impact Analysis
| Restraint | ( ~ ) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
|---|---|---|---|
| Limited affordability among lower-income groups constraining residential uptake | -0.9% | National, particularly outer islands and rural areas | Medium term (2-4 years) |
| Oversupply of condominiums in major urban areas slowing price growth and absorption | -0.6% | Jakarta CBD, Surabaya central, Bandung premium segments | Short term (≤ 2 years) |
| Lengthy permitting processes and regulatory complexity delaying project execution | -0.4% | National, with particular impact in emerging regions | Medium term (2-4 years) |
| High construction and financing costs impacting developer margins and end-user pricing | -0.3% | National, with acute impact in remote areas | Short term (≤ 2 years) |
| Source: Mordor Intelligence | |||
Limited Affordability Constrains Lower-Income Housing Access
Low-income households face the brunt of an 11 million-unit housing backlog in Indonesia. Budget constraints are hampering project roll-outs, with allocations for 2025 set to dip below those of 2024. The widening income gap between Java and its outer islands exacerbates affordability challenges. This underscores the necessity of subsidies and innovative financing to tap into this demand. Absent these measures, Indonesia's real estate market may leave a significant demographic in the lurch, stunting its growth potential.
Condominium Oversupply Pressures Urban Premium Segments
Jakarta's real estate market is navigating a challenging phase, particularly in the premium condominium segment. In Jakarta's CBD, rising inventory levels have outpaced end-user absorption, leading to extended sales cycles and tempered price increases. Luxury developments, often linked to foreign buyers, struggled during the pandemic and are still seeking to regain their previous momentum. In response, developers heavily invested in high-end projects are shifting their focus towards mid-market offerings to safeguard their profit margins. This divergence underscores the varying pace at which different micro-markets within Indonesia's broader real estate landscape are adjusting to the influx of new stock. As the market recalibrates, stakeholders will need to adapt strategies to align with evolving demand dynamics.
Segment Analysis
By Property Type: Commercial Segment Accelerates Despite Residential Dominance
Residential assets captured 56.7% of the Indonesia real estate market in 2024, anchored by demographic growth, the 3 million houses initiative and still-strong cultural preferences for ownership. This dominance is evident in the Indonesia real estate market size for housing, and pre-sales remain concentrated in landed houses outside the Jakarta inner ring. Apartments and vertical condominiums are gaining share in Surabaya and Bandung as land becomes scarce, while villas attract lifestyle buyers in suburban corridors. Government backing via VAT relief and subsidised mortgages continues to secure front-loaded demand, ensuring that the Indonesia real estate market retains a solid residential backbone[3]Journal of Urban Planning and Development, “Vertical Housing Trends in Jakarta and Surabaya,” ASCE Library, ascelibrary.org.
The Commercial category, though smaller, is set to expand at a 5.98% CAGR, the fastest among property types. Logistics warehouses lead this surge, propelled by e-commerce penetration and Indonesia’s hub role within ASEAN supply chains. Office formats are migrating toward flexible workspaces, and data-centre footprints are widening as Telkom Indonesia courts new investors. Integrated tourism complexes such as the USD 2.58 billion PIK 2 project are also amplifying hospitality pipelines. These dynamics suggest that commercial stock will command an increasing slice of the Indonesia real estate market size through 2030.
Note: Segment shares of all individual segments available upon report purchase
Get Detailed Market Forecasts at the Most Granular Levels
Download PDF
By Business Model: Rental Segment Gains Momentum Amid Sales Dominance
The Sales model controlled 70.1% of Indonesia real estate market revenue in 2024, reflecting the population’s strong home-ownership ethos and policy support. Aggressive land-banking strategies by prominent developers secure future launch pipelines, while digital booking platforms shorten transaction times. Interest-rate cuts and VAT exemptions have created a near-term surge in deed transfers, reinforcing the sales culture within the Indonesia real estate market.
Rental assets are nevertheless on a 6.31% CAGR trajectory, benefiting from professional mobility and the new capital city’s transitional housing needs. Yields in Jakarta and Surabaya have ticked up as co-living formats capture Generation Z tenants. Institutional capital—often via REITs—seeks predictable cash flow and is gradually formalising property management standards. The Indonesian real estate industry, therefore, shows a bifurcation: ownership remains aspirational, yet rental products are gaining legitimacy and liquidity.
By End-User: Corporate Demand Accelerates Alongside Household Dominance
Individuals & Households retained 61.2% share of the Indonesia real estate market in 2024, driven by first-home buyers and family-upgrade cycles. Mortgages remain affordable relative to wage growth, sustaining this user group’s liquidity. Tax discounts reinforce purchase intentions, and households continue to dominate absorption, especially in Java’s commuter belts.
Corporates & SMEs are forecast to log the highest 6.12% CAGR as factory expansions and service-sector upgrades require new footprints. East Java’s industrial estates exemplify this shift, attracting electronics and automotive investment that needs adjoining worker housing and logistics hubs. Nusantara has sparked government agency and supplier relocations, catalysing temporary and long-term office demand. As foreign ownership rules relax, international investors also emerge within the Others category, collectively diversifying the Indonesia real estate market’s end-user mix.
Note: Segment shares of all individual segments available upon report purchase
Get Detailed Market Forecasts at the Most Granular Levels
Download PDF
Geography Analysis
DKI Jakarta accounted for 31.8% of the Indonesia real estate market in 2024, fortified by its role as financial nucleus and consumer-spending powerhouse. MRT line extensions and the completion of the Jakarta-Bandung fast rail improve intra-metro accessibility, bolstering both residential and office values. Developers are repositioning portfolios toward mixed-use townships to accommodate expected shifts once government ministries relocate to Nusantara.
East Java is the fastest-growing province, poised for a 6.61% CAGR through 2030. Surabaya’s port modernisation and the Gresik Java Integrated Industrial Estate are magnets for FDI, which drives knock-on housing and commercial requirements. Toll upgrades enhance connectivity to Central and East Indonesia, firmly inserting East Java into regional supply chains and broadening the Indonesia real estate market beyond Jakarta.
West Java and the Rest-of-Indonesia cluster deliver incremental upside. West Java benefits from spill-over industrial demand as land prices in Jakarta escalate. Special economic zones in Sumatra and the entire Kalimantan corridor, particularly around Nusantara, open greenfield avenues for township builders. Continued rollout of National Strategic Projects—41 were completed by end-2024—ensures multi-region tailwinds and gradually reduces Jakarta’s dominance within the wider Indonesia real estate market.
Competitive Landscape
The Indonesia real estate market is moderately concentrated, with top Indonesian developers practising township models that integrate residential, commercial, and leisure assets on large tracts. PT Bumi Serpong Damai posted a 12.74% revenue rise to USD 744 million in 2023, demonstrating the cash-flow resilience of land-bank strategies. PT Ciputra Development, PT Pakuwon Jati, and PT Summarecon Agung hold similar positions, each leveraging long-dated land reserves to maintain launch optionality.
Strategic pivots include heavier use of digital marketing, green-building certifications, and the formation of JVs with foreign capital. Foreign investors—encouraged by the Omnibus Law—enter through minority stakes or design-build-operate partnerships, injecting global ESG standards into local projects. Developers are also exploring PropTech tools, from VR apartment tours to blockchain-based contracts, to improve buyer conversion rates and back-office efficiency.
Supply-chain linkages influence cost control. Indonesia’s cement industry is dominated by SIG, which has a 50.5% share and therefore considerable pricing power. Leading real estate firms hedge against cost spikes by pre-ordering materials and negotiating volume discounts. As infrastructure corridors expand outward from Java, the competitive field is expected to broaden, yet incumbent land ownership patterns continue to provide high barriers to entry within the Indonesia real estate market.
Indonesia Real Estate Industry Leaders
-
Sinar Mas Land
-
PT Ciputra Development Tbk
-
PT Pakuwon Jati Tbk
-
AGUNG PODOMORO GROUP
-
PT Summarecon Agung Tbk
- *Disclaimer: Major Players sorted in no particular order
Need More Details on Market Players and Competitors?
Download PDF
Recent Industry Developments
- June 2025: Indonesia invited foreign investment in an USD 80 billion seawall to protect coastal areas and raise climate-resilient real estate values.
- February 2025: Parliament approved a Temasek-like sovereign fund to deepen strategic investments, potentially influencing future property allocations.
- February 2025: An Indonesian fund and Mitsui bid for a USD 300 million stake in toll operator RKE, underscoring infrastructure’s pull on real estate values.
- January 2025: President Prabowo committed USD 3 billion to Nusantara through 2029, with private capital including a USD 419.4 million hospitality-office project.
Research Methodology Framework and Report Scope
Market Definitions and Key Coverage
According to Mordor Intelligence, our study measures Indonesia's real estate market as the yearly gross value (in USD) of completed residential, commercial, retail, hospitality, and light-industrial properties that are sold or formally leased, converted from rupiah using average annual rates.
Scope exclusion: We purposely leave out land-only speculation deals without standing structures.
Segmentation Overview
- By Property Type
- Residential
- Apartments & Condominiums
- Villas & Landed Houses
- Commercial
- Office
- Retail
- Logistics
- Others (industrial real estate, hospitality real estate, etc.)
- Residential
- By Business Model
- Sales
- Rental
- By End-user
- Individuals / Households
- Corporates & SMEs
- Others
- By Region
- DKI Jakarta
- West Java (Jawa Barat)
- East Java (Jawa Timur)
- Rest of Indonesia
Detailed Research Methodology and Data Validation
Primary Research
We spoke with developers, brokers, housing-finance officers, materials distributors, and city planners across Java, Sumatra, Kalimantan, and Bali. These interviews, coupled with short buyer-sentiment surveys in Jakarta, helped us verify absorption rates, average selling prices, and pipeline timing that were unclear in secondary work.
Desk Research
Our analysts screened tier-one public sources such as Statistics Indonesia, Bank Indonesia price indices, Ministry of Public Works housing dashboards, and Real Estate Indonesia briefs. They then tied in company filings, IPO prospectuses, and credible press carried on Dow Jones Factiva. Additional signals came from D&B Hoovers developer financials, building-permit logs, and customs data on steel, cement, and ceramic tile imports that mirror project completions. Mordor analysts also tapped paid datasets like Volza shipment records and Questel patent trends in modular construction to sharpen supply-side assumptions. The sources named are illustrative; many other publications supported data checks and clarifications.
Market-Sizing & Forecasting
We start with a top-down rebuild that links gross fixed capital formation in real estate to property price and rental indices, which are then distributed across segments using occupancy and permit data. Select bottom-up roll-ups, sampled developer revenues, and average selling price times unit deliveries validate and fine-tune totals. Key inputs include mortgage rates, urban population growth, foreign direct investment approvals, housing starts, rental yields, and the Residential Property Price Index. We forecast through multivariate regression blended with scenario analysis so our model reacts to GDP and interest-rate shifts. Missing bottom-up series are bridged with weighted moving averages.
Data Validation & Update Cycle
Model outputs face variance tests against independent metrics before a senior review. We refresh every twelve months and open an interim cycle whenever policy shocks or large asset revaluations emerge, ensuring clients receive the most current, vetted view.
Why Mordor's Indonesia Real Estate Baseline Earns Trust
Published numbers often diverge because firms select different scopes, base years, and currency treatments.
Our disciplined definition, annual refresh, and dual-track triangulation give decision-makers a dependable centerline.
Benchmark comparison
| Market Size | Anonymized source | Primary gap driver |
|---|---|---|
| USD 66.74 B (2025) | Mordor Intelligence | |
| USD 95.40 B (2024) | Global Consultancy A | Counts undeveloped land banks and notional pipeline values, inflating total |
| USD 64.78 B (2023) | Regional Consultancy B | Older base year and omits lease revenue, producing a lower view |
| USD 60.37 B (2024) | Trade Journal C | Uses transaction revenue only, excludes owner-occupied asset value |
The comparison shows that, while others swing high or low, Mordor Intelligence delivers a balanced, transparent baseline anchored to measurable variables and repeatable steps.
Need A Different Region or Segment?
Customize Now
Key Questions Answered in the Report
What is the current size of the Indonesia real estate market?
The market stands at USD 66.74 billion in 2025 and is forecast to hit USD 86.98 billion by 2030, implying a 5.44% CAGR.
Which property type dominates the Indonesia real estate market?
Residential assets lead with 56.7% share in 2024, supported by demographic growth and government housing programmes.
Which region is growing fastest within Indonesia’s property sector?
East Java is projected to record a 6.61% CAGR through 2030, outpacing all other provinces.
Why is the rental segment expanding quickly?
Rising workforce mobility, co-living concepts and Nusantara’s transitional housing needs are driving a 6.31% CAGR in rental revenue.
How is infrastructure influencing property values?
USD 128.6 billion worth of National Strategic Projects and new toll roads are reducing logistics costs and unlocking fresh development corridors.
What are the key risks facing investors in the Indonesia real estate market?
Construction-cost inflation, regulatory complexity and condominium oversupply in premium urban sub-markets are the primary downside factors.
Page last updated on:
