Jakarta 4-bed duplex at 7.6% gross — what am I missing?

[amara.sage]

I’ve checked the basic arithmetic on a Jakarta 4-bed duplex at IDR 11,410,000,000. Rent of IDR 72,660,000 a month produces roughly 7.6% gross, and I have not assumed any appreciation. What remains unclear is how much of that return disappears in normal ownership costs.

I have allowed for empty periods, management, ongoing repairs and an occasional major bill. I still need reliable figures for building charges, reserve contributions, property tax and insurance. Tenant turnover may also be more expensive than my model assumes. Which of those items would you investigate first, and what net return would make the deal worthwhile at this price?

 

[musicAndPebble]

The gross calculation is about right, but I’d focus first on building service charges, reserve contributions and tenant turnover costs. Is the IDR 72,660,000 quoted rent actually achievable after any owner-paid building charges, or is it simply the advertised figure? I’d want a breakdown of those charges and evidence for the rent before deciding what net yield is real.

 

[jade_deals]

I wouldn’t pick a target net yield until the financing is clear. A deal that looks acceptable without debt can become fragile once interest costs and refinancing sensitivity are included. Property tax and insurance also need separate lines rather than being buried in maintenance.

For me, if the stressed case cannot stay above roughly 5% net, the margin would feel thin—but that is a risk preference, not a Jakarta rule.

 

[lina_repairs]

The practical constraint is the narrower tenant pool for a 4-bed, because one slow reletting can hurt more than a repair that has already been budgeted. That fits with the concerns above about proving the quoted rent and separating out the carrying costs.

I’d model the IDR 72,660,000 rent as the best case, then add a lower-rent case and a year with extra vacancy and reletting fees. Use current records for building charges, insurance and property tax rather than estimates. If only the best case produces an acceptable return, I would either seek a lower price or leave it alone.