Factors inuencing the price of
housing in Indonesia
Raden Aswin Rahadi, Sudarso Kaderi Wiryono and
Deddy Priatmodjo Koesrindartoto
School of Business and Management, Institut Teknologi Bandung,
Bandung, Indonesia, and
Indra Budiman Syamwil
School of Architecture, Planning and Policy Development, Institut
Teknologi Bandung, Bandung, Indonesia
Abstract
Purpose – This study aims to address the factors or attributes that would inuence the price of
residential products in Jakarta Metropolitan Region.
Design/methodology/approach – In total, 202 respondents from all across Jakarta Metropolitan
Region participated in the questionnaire for this study. Demographic questions are categorized into age,
gender and preferences for real estate locations. The questionnaire was made based on the author’s
previous studies. Of the total respondents, 127 were males and 75 were females with age ranging from
18 to 56 years old. For data analysis, the authors utilized factor analysis, Cronbach’
␣
test and analysis
of correlation to reach the conclusion of this study.
Findings – The ndings suggested that from the initial three factors groups, there are ve new groups
that emerge as inuencing factors for housing prices. Cronbach’
␣
score were veried (
␣
ϭ 0.906).
Correlation study result suggested that the initial three factors groups produce a signicant correlation
between each of them, except for the factor of “overall location” and “located near family.” After factor
analysis, the research results show that there are two new additional groups of factors that emerge as
inuences to housing prices. There are signicant scores of differences between gender and real estate
location preference toward the groups of factors.
Research limitations/implications – This study shows how physical qualities, concept and
location factors inuence the housing price perception of their consumers. The result shows to be
relatively reliable and valid.
Originality/value – The study is the rst to analyze the relationship between the factors for
preferences on residential products and housing price in Indonesia. This paper is also intended to be the
rst to pioneer the study on factors of preferences on residential products in Indonesia. The ndings will
be useful to develop pricing models for housing product in Indonesia.
Keywords Real estate, Housing markets, Housing prices, Housing market analysis,
International housing markets, Residential property
Paper type Research paper
Introduction
Jakarta, as the capital city of Indonesia with the size of approximately 65.000 ha, has
over the past years developed into a Metropolitan city. Unlike major cities in other
countries around the world, Jakarta serves as both the government and business center
for Indonesia. This condition is causing Jakarta to become the main attraction point for
urbanization and business for people from all over Indonesia. As the city does not have
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Price of
housing in
Indonesia
169
Received 17 April 2014
Revised 25 July 2014
Accepted 10 August 2014
International Journal of Housing
Markets and Analysis
Vol. 8 No. 2, 2015
pp. 169-188
© Emerald Group Publishing Limited
1753-8270
DOI
10.1108/IJHMA-04-2014-0008
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