When Indonesia’s Minister of Finance speaks, the market listens. This time, it’s applauding a stimulus policy that revitalizes the property sector and its supporting industries.
Finance Minister Purbaya Yudhi Sadewa has extended the government-borne Value Added Tax (VAT) incentive for property purchases until December 31, 2027. And foreigners can enjoy this benefit as well.
A Sense of Optimism
Originally, this benefit was set to expire at the end of 2026. The move comes as a breath of fresh air for the property industry, which has been grappling with global economic uncertainty.
Joko Suranto, Chairman of Real Estate Indonesia (REI), welcomed the decision. He believes the policy offers clarity and room for developers to plan their mid-term business strategies.
“This policy can be part of a measurable business plan. With the 2027 deadline set from the start, developers can move forward with greater confidence,” Joko said.
Beyond just the developers, the policy is expected to positively impact the housing market and investment climate. The incentive is seen as a spark for optimism among both homebuyers and property investors.
“This policy sends a positive signal to everyone — to buyers looking for homes, and to those wanting to do business, whether investors or industry players. It creates a sense of optimism,” Joko added.
Apply for the Property VAT Incentive
This program gives you 0% VAT when buying property priced between Rp2 billion and Rp5 billion. Both Indonesian citizens and foreigners can apply, as long as you’re buying the property for your own use and you have Indonesian ID and Tax Number.
Even if you’ve received this incentive before, you can still get it again for a new property purchase during this period.
Steps to Apply for the Property VAT Incentive :
1. Choose a property that meets the rules: it must be new, ready to live in, officially registered, and priced within the allowed range. Foreign buyers must follow ownership rules from the start.
2. Sign the Sale and Purchase Deed or a fully paid Sale Agreement with a notary or land deed official. Make sure your first payment and handover date fall within the eligible time period.
3. Ask the developer to issue a tax invoice with a special code showing it’s part of the government’s VAT incentive. This means you won’t be charged VAT.
4. The developer reports the sale to the tax office and inputs the property data to the related ministry.
5. Keep all documents safe in case they’re needed for verification or audit later.
Alternative Sectors Take the Spotlight
While the VAT incentive boosts confidence in residential property, it’s not the only area drawing attention. Investors are also eyeing new opportunities beyond housing in sectors that reflect Indonesia’s evolving economic priorities.
After years of being dominated by residential and office sectors, investor attention is now shifting toward alternative segments like logistics, healthcare, education, and data centers. This shift is seen as a sign of transformation in Indonesia’s property landscape.
“Indonesia’s real estate market is at a turning point, where adjustments to oversupply in traditional sectors are opening up opportunities in alternatives like logistics, education, healthcare, hospitality, and data centers,” said Farazia Basarah, Country Head of Jones Lang LaSalle Indonesia, during the “Next Chapter of Indonesia Real Estate” event in late October.
JLL Southeast Asia Managing Director Michael Glancy also shared several trends expected to shape the future of Indonesia’s property industry.
To attract more investors, the Indonesian government is offering tax incentives and easing investment procedures for developing Special Economic Zones in areas like Jabodetabek, Bali, and Batam.
High demand is coming from sectors such as healthcare, education, and research. A number of clinics, hospitals, and international R&D facilities are expanding their networks in these regions.
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