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Tax Incentives Can Boost Property Sector Growth In 2025

The property sector is expected to grow in 2025. This new cycle follows a significant reset in the property market due to the pandemic, which caused stagnation for four years. Ishak Chandra, the CEO of PT Perintis Triniti Properti Tbk (TRIN), shared this information during a media gathering at his office in Jakarta on Thursday, November 31, 2024.

Ishak noted that property cycles repeat every 8-10 years and are heavily influenced by political events like elections. Before the pandemic, it was anticipated that the property sector would grow in years ending with a 9, such as 2009, and decline in years ending with a 4, like 2014.

"Therefore, 2019 should have seen growth in 2020. Why didn’t it happen? Because of the pandemic," Ishak explained. The pandemic held back the property sector in 2020, 2021, 2022, and 2023, and now it must adapt again for the 2024 elections.

After the pandemic and elections, a shift in the property cycle is predicted, leading to growth in 2025. "Hopefully, nothing will hinder this. If all goes well, property prices will rise," Ishak added.

However, this growth prediction relies on government support through incentives like Value Added Tax (VAT) and Land and Building Acquisition Duty (BPHTB).

Next year, VAT may increase to 12%. Meanwhile, BPHTB is set at 2.5-5% depending on the region. "Lastly, I emphasize the need for proper regulations regarding foreign ownership," he stated.

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Tag: Ishak Chandra Property Sector Tax Incentives