House price index
Indonesia's property price index shows very modest growth. The reason is that prices are rising in regions driven by foreign demand, but these increases are diluted within the broader national market, which remains largely stagnant. With a population of 285 million, Indonesia ranks among the most populous countries in the world.
Number of transactions
In 2025 transaction volume is estimated at approximately 325,000, reflecting a partial recovery from the 2024 downturn but still below the peak levels of 2022–2023. The market retains its resilience thanks to the dominance of domestic demand, yet it is entering a phase of cyclical normalisation amid tighter financial conditions and cautious buyer behaviour.
Share of foreign buyers
There are no precise statistics on the share of foreign buyers in Indonesia's total transaction volume. Estimates suggest, however, that foreign buyers account for roughly 5–12% of property purchases per year.
Price per square metre
In 2025 Indonesia's price structure remains distinctly segmented. Bali holds its position as the most expensive market at around USD 3,500 per m², reflecting a strong dependence on foreign demand and a limited supply of quality assets. Jakarta ranks second (~USD 2,250 per m²), showing a more stable trend driven by domestic demand. Surabaya, Bandung and Medan remain predominantly local-demand markets with significantly lower entry prices and limited investment liquidity.
Rental yield
In 2025 Indonesia shows a clear divergence between entry prices and rental yields. Bali remains both the most expensive and the highest-yielding market, driven by tourism and foreign demand, yet it is marked by greater volatility. Jakarta displays a more balanced profile, with moderate yields and steady domestic demand. Surabaya, Bandung and Medan continue to be predominantly local-demand markets with limited liquidity and gradually declining yields as prices rise.
Foreign demand
In 2025 the structure of foreign demand in Indonesia remains diversified and resilient. Singapore continues to be the largest source of foreign capital, reflecting both geographic proximity and strong investment integration between the two markets. The United States and Australia form the second tier of demand, oriented primarily towards investment and lifestyle purchases. Malaysia's share is growing moderately, while Japan remains a niche participant. The «other» category has expanded, indicating a gradual broadening of international interest without the emergence of a dominant external player.
In 2025 Indonesia's real estate market demonstrated resilience and structural maturity despite slowing economic growth and tighter financial conditions. Transaction volumes recovered partially from the 2024 downturn, reaching approximately 325,000 transactions, yet the market did not return to the peak levels of 2022–2023, indicating a shift into a phase of cyclical normalisation. Market dynamics continue to be determined primarily by domestic demand, while foreign capital plays a complementary but important role in individual segments.
Price dynamics in 2025 remained moderately positive but uneven across regions. Jakarta holds its position as the most stable and liquid market, driven by domestic demand and long-term ownership strategies. Bali remains both the country's most expensive and its highest-yielding market, yet its high returns rest on tourist demand and come with elevated volatility and sensitivity to external shocks. The second-tier cities of Surabaya, Bandung and Medan continue to offer lower entry prices and are supported mainly by local demand, with limited investment liquidity.
The rental segment remained one of the key drivers of Indonesia's investment appeal in 2025. Gross rental yields in most major cities continue to exceed those of developed markets, sustaining interest among income-oriented investors. At the same time, operational and regulatory risks are increasing in tourist regions, primarily because of overheating in individual submarkets.
Foreign demand in 2025 is characterised by a diversified structure with no single dominant source of capital. Singapore, the United States and Australia form the core of investment flows, strengthening market resilience and reducing dependence on any one country. Foreign buyers nevertheless remain concentrated in a narrow asset segment, above all in Bali and in selected districts of Jakarta.
Under the baseline scenario, Indonesia's real estate market is expected to continue developing along a path of controlled stabilisation in 2026. A significant acceleration in transaction volumes is unlikely: activity will most probably remain in the range of 320,000–335,000 transactions, reflecting the balance between resilient domestic demand and the constraints imposed by financing costs. The market is moving firmly into a mature phase of the cycle, with no signs of nationwide overheating.
Price growth in 2026 is expected to remain moderate, in the range of 3–7% per year depending on the region. Jakarta and the major metropolitan areas are likely to remain the most stable markets, while Bali will continue to offer higher yield potential alongside elevated volatility and the risk of local corrections. Second-tier cities are expected to grow slowly and to remain niche from an investment perspective.
The rental market is expected to remain competitive in 2026 and to continue serving as a key argument in favour of Indonesia relative to other Southeast Asian markets. Investors will nevertheless need to apply stricter selection criteria when assessing locations and property formats, particularly in tourist zones, where the risk of oversupply is gradually increasing.
In 2026 Indonesia remains a market of moderate growth, high yields and pronounced regional differentiation. It is well suited to investors focused on rental income and long-term holding strategies, but it requires careful asset selection and a clear understanding of local regulatory and operational risks.
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