Factors influencing the price of housing in Indonesia

Purpose - This study aims to address the factors or attributes that would influence 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' alpha test and analysis of correlation to reach the conclusion of this study. Findings - The findings suggested that from the initial three factors groups, there are five new groups that emerge as influencing factors for housing prices. Cronbach' alpha score were verified (alpha = 0.906). Correlation study result suggested that the initial three factors groups produce a significant 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 influences to housing prices. There are significant 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 influence the housing price perception of their consumers. The result shows to be relatively reliable and valid. Originality/value - The study is the first 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 first to pioneer the study on factors of preferences on residential products in Indonesia. The findings will be useful to develop pricing models for housing product in Indonesia.