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New Flash: Easing LTV has little impact on property
Easing the loan-to-value (LTV) policy by lowering it 10 to 80 percent will have little impact on the property market, according to the majority of developers
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asing the loan-to-value (LTV) policy by lowering it 10 to 80 percent will have little impact on the property market, according to the majority of developers.
'It will only lead to roughly a 5 percent increase in the market,' said Association of Housing Development in Indonesia (APERSI) chairman Eddy Ganefo.
He agreed that the policy was good but said that it would not have a great impact. 'The ideal LTV on property credit for the first house should be 90 percent, so prospective buyers would only need to pay 10 percent of the total price as a down payment,' said Eddy.
If the idea materialized, Eddy was confident that it could boost the property market up to 30 percent. The most affected segments for this policy would be the middle-class group, who seek housing prices at between Rp 200 million and Rp 1 billion per unit, he said.
Green Pramuka City marketing manager Joko Sumariyanto had a similar view as Eddy, saying that a 10 percent decline in LTV on property credit would have little effect on the property market due to the declining purchasing power partly caused by the slowdown of the national macro economic conditions.
