Indonesian Property Sector Sees Significant Rally in 2025

Strong Market Performance

The Indonesian property sector has demonstrated remarkable growth in 2025, with the IDX Properties & Real Estate index surging 54.41% year-to-date as of December 29, 2025. This impressive performance significantly outpaces the broader market, as evidenced by the IHSG's gain of only 22.1% over the same period.

Drivers of Growth

Senior Analyst Sukarno Alatas from Kiwoom Sekuritas attributes the sector's strong performance primarily to Bank Indonesia's aggressive monetary easing. The central bank cut its benchmark interest rate five times throughout 2025, ultimately bringing it down to 4.75%. This reduction in interest rates has had a cascading effect on the property market:

1. Lower cost of funds for banks, enabling more competitive mortgage rates
2. Increased demand for housing loans (KPR), as lower interest rates make borrowing more attractive
3. Enhanced appeal of high-beta property stocks, as investors seek higher returns in a low-rate environment

Market Outlook

The combination of these factors has created a favorable environment for property stocks, particularly those with high growth potential. As the sector continues to benefit from the current monetary policy stance, investors are advised to look closely at promising stocks within the property sector.