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Every expat that comes to Indonesia has a different story to tell about how they found their home. In the worst cases, the story details a long exhaustive quest for just the right house for the family. In many stories, unqualified agents take newly arrived expats around to houses that are outside their budget, in unacceptable condition, don't match the needs of the family or are located far from the neighborhood that the family wants to live in. The complaints made by unhappy newcomers after days spent stuck in traffic looking at unsuitable houses make up the tales of expat nightmares!
These nightmares can be avoided by using a reputable agent/broker to help you with your search. Your choice of housing agents and brokers includes independent brokers, franchised real estate brokers affiliated with multinational real estate firms and corporate housing services/relocation services.
As in so many business dealings with expats in Indonesia, there are a multitude of brokers that would like to help newly arrived expats find a house. Independent brokers are self-appointed agents who use word-of-mouth and personal connections to try to locate potential residences for expats. They may or may not actually be the sole representative of the landlord of individual properties, but since the landlord pays their fee, they have a vested interest in getting you to pay the highest amount possible to lease the house.
Many newly arrived expats are referred to such brokers by someone in their sponsoring company - from the HR or Formalities departments in a major multinational or by other staff in key positions. These independent brokers often offer the person 'inside' the company a percentage of their fee for a successful signing. While this type of arrangement does benefit someone in your sponsoring company and/or their relatives or friends, there is no guarantee whatsoever that this person has the personal or business resources or the skills to help you find the most suitable house for your family.
Most independent brokers find houses through word of mouth and networking with other brokers. While many brokers specialize in a particular area, they will be willing to help you find a house in other areas as well. What they do then is contact other brokers who have contacts in that area that know what houses are available.
Utilizing this system may work, though the search is much lengthier. You will also undoubtedly see a lot of unsuitable homes in the process, as your broker will not be personally familiar with most of the houses they show to you. The negotiation process will also involve more than one broker, sometimes up to 3 or 4, since every broker that had a hand in referring the house will want a piece of the commission pie. The broker you are dealing with may not be the one actually talking to the potential landlord, which can cause lots of problems as well.
Independent brokers/agents should NOT be charging you anything for their services since they receive their commission from the owner. While the agent is providing assistance to you, remember that it is the owner that is paying the agent's commission. Be cautious about expecting that they will always promote your side at the bargaining table when they are 'working for' the owner as well as paid by the owner. There may be no advantage to them in trying to find the best deal possible for you as their commission will be bigger if you have to pay more for the house. Current commissions run from 5% up to 10%, so you can see that when dollar rents are at stake, the commission is significant.
The Jakarta Shoppers' Guide, published by the American Women's Association, contains a listing of independent housing brokers that have been recommended by expatriates who have been satisfied with their services.
Franchise Real Estate Brokers
In recent years, rising consciousness of the disadvantages of using independent brokers, and a demand from expats and Indonesians alike for more professional real estate services, has led to an increase in professional real estate brokers in Jakarta. Multinational real estate brokerage services have franchised in the local market and trained real estate professionals in international practices. This industry, however, is still in its infancy. There is no central computerized Multiple Listing Service in Indonesia. Each individual agency compiles its own database of listed houses.
A disadvantage to using a franchised broker is that they will only show you houses that they have listings for. Also, these franchises are purchased by individuals and while training from the franchise company does occur, a varying level of professionalism is seen from broker to broker.
Corporate Housing Services/Relocation Services
Going one step further, corporate Housing Services, such as Colliers International, provide expatriates, and especially their sponsoring companies, with a big advantage. Their goal is to truly represent the needs and concerns of the client company and its expatriate staff. They are committed to finding you the best deal possible. This is because they want the client relationship with the company to be long term. Their success is measured by the continued use of their services by their corporate clients, who are pleased to know that the housing agent will be 100% on their side throughout the search and into negotiations with the prospective landlord.
In lease negotiations these firms are committed to representing you and your needs. They will check the entire condition of the house and insist on repairs and upgrades according to your needs. Especially where they will carry a maintenance contract for the client, they want to be sure everything is in good operating order in the house before you move in. Since they don't represent the landlord, they are not under any pressure to lease you one house over another ... their goal is to fully meet the expectations of the expat family.
These firms often also provide comprehensive relocation services to expats relocating to Jakarta. In addition to home search services, they offer orientation programs, lease negotiation/re-negotiation services and executive housing management. Many firms have found that corporate housing services save their companies a lot of money over in-house housing departments as these staff too often follow corrupt practices.
These firms' extensive contacts can also help you to find subleases for short-term stays.
Housing Assessment Survey
According to Colliers International one way you will be able to determine the professionalism of the agent you use, is by whether or not they use a housing survey to determine the needs of the incoming expatriate families. These surveys help professional agents narrow down the search to the most acceptable houses.
When your agent conducts the Housing Needs Assessment, be VERY specific about exactly what you are looking for in a house or apartment. Talk about your lifestyle, particular interests, the needs of each family member, personal and company entertaining needs and other personal concerns to ensure that you get the most appropriate matches possible and that the agent isn't wasting your time showing you homes that don't fit your family's needs. Ask LOTS of questions about each house you see. You will soon determine just how familiar the agent is with the property and its owner.
Housing Costs and Terms
One of the most pertinent questions you should know before you start your housing search is the amount your company allots for your housing allowance. Housing of acceptable standards ranges from nice apartments for as little as US$600/month (in South Jakarta) to stately mansions for US$ 5,000 a month and more. Needless to say, there is a wide variety of choices in between these two extremes. Nice homes in good neighborhoods are available for US$ 1,500 to $2,500/month. For higher rents, the house should have facilities for entertaining or other substantial features to justify the additional cost.
Previously established practices of asking for 2 to 3 years rent in advance have also changed, with owners willing to rent for shorter periods of time or asking only one year's rent in advance. Some apartments are available on three-month renewable leases. Renters of apartments may ask the landlord to peg the rupiah/dollar exchange rate at something lower than the market rate. This is not as common with homeowners. Private homes were not paid for with foreign US dollar loans, like the big apartment towers probably were, so a rupiah payment should be acceptable to the owner in today's economic conditions.
Bargain vigorously to protect the financial interests of your sponsoring company and to prevent inflationary pressures in the prices of houses rented to expats. The lowering costs of house rentals is a welcome relief for foreign investors who must cover high living costs for their expatriate staff. The same house, rented to an Indonesian, would go for 1/5 the price as they don't walk in the door with a dollar housing allowance to begin with.
For more information, see the Residential Leasing Guidelines
The Jakarta Post Classifieds has many listings for houses and apartments, either offered by brokers or direct from owners and property management firms. Be cautious when calling listings in the newspaper as it's difficult to determine the background and reliability of the persons representing the houses. Most listings are from independent brokers. Utilizing an independent broker, you have little legal recourse or professional representation in the lease negotiation process, such as you would have through professional corporate housing services or a real estate brokerage service.
If you are fortunate enough to have your company send you on a 'look-see' trip in advance of your moving to Indonesia, use a portion of this time to contact real estate brokers and see a few homes or apartments to get an idea of what types of homes/apartments are available. While you can't expect to find your new home on a familiarization trip, you could at least become more knowledgeable about what neighborhoods and homes are like and what your preferences may be.
Better yet, you will have a feel for which brokerage service you will want to use when you actually start your search. Once you've made that decision, you can keep in touch with them in the months prior to your arrival and they can short-list potentially suitable homes before you arrive.
Finding a house in Jakarta can be a long series of hassles or a pleasant, professionally organized adventure. Utilizing a professionals in the field, such as Colliers International, will go far to reduce your frustrations and speed up the process of looking for your new home in Jakarta.
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