Investment Property in Palembang

Investment Real Estate in Palembang

Palembang property investment can be a worthwhile venture if you are selective with the areas you choose to invest in. If not, you could find that your investment suffers due to low rental yields, dwindling demand, and slow property price growth in many parts of Palembang.

Search Map of Palembang Investment Real Estate

Palembang (Indonesian pronunciation: [paˈlɛmbaŋ]) is the capital city of the Indonesian province of South Sumatra. The city proper covers 400.61 square kilometres (154.68 square miles) on both banks of the Musi River on the eastern lowland of southern Sumatra. It had a population of 1,668,848 at the 2020 Census. Palembang is the second most populous city in Sumatra, after Medan, and the ninth most populous city in Indonesia.

The Palembang metropolitan area has an estimated population of more than 3.5 million in 2015. It comprises parts of regencies surrounding the city, including Banyuasin, Ogan Ilir, and Ogan Komering Ilir.

Palembang is one of the oldest cities in Southeast Asia. It was the capital of Srivijaya, a Buddhist kingdom that ruled much of the western Indonesian Archipelago and controlled many maritime trade routes, including the Strait of Malacca. A Chinese monk, Yijing, wrote that he visited Srivijaya in the year 671 for 6 months.

Palembang was incorporated into the Dutch East Indies in 1825 after the abolition of the Palembang Sultanate. It was chartered as a city on 1 April 1906.

Palembang was the host city of the 2011 Southeast Asian Games and the 2018 Asian Games along with Jakarta. The first light rail system in Indonesia was operated in Palembang in July 2018.

The city is a major domestic tourist destination attracting a total of 2,011,417 tourists in 2017, however, it is not a well-known international tourist destination as foreign tourists only account for 9,850 out of the aforementioned total tourist arrivals. Traffic jams, floods, slums, pollution, and peatland fire are problems in Palembang.

Get Our Latest List of Investment Property in Palembang

The financial stability of Palembang has translated into a real estate market that rewards forward planning and a willingness to look beyond areas of traditional affluence.

Buy to Rent in Palembang

Renting out your Palembang buy-to-rent investment property can grow wealth and income.

Whatever your goals with investment property in Palembangare – preparation is key:

Set goals based on how much rental yield will be required and the local rental yield rates in Palembang and be prepared to change your initial outlook.
Thoroughly research the Palembang location with a special emphasis on fringe areas outside the main Palembang metropolis that may be valued lower than their better-known neighbours. Rental yields of around 5% are still attainable in certain areas of Palembang.
Ensure that your target investment property in Palembang appeals to professionals. This is a demographic that ensures maximum income and low voids.
Finding and vetting suitable tenants is a job ideally left to the professionals. Working with an established letting agent with local knowledge and experience of property legislation will give you the best chance of success.

Flipping Investment Property in Palembang

Flipping property in Palembang

Flipping property is when we advise clients to buy a Palembang property below market value, renovate it and then make a profit by selling it at a higher price, all within a few months, and often before the Palembang market has a time to react to the renovation.

The Flipping Strategy in Palembang

Investment property flipping in Palembang is a simple strategy. You find a property that is in need of renovation from our list and purchase it for a low price. These type of Palembang real estate investments are sometimes referred to by professionals as ‘distressed’ Palembang real estate.

What is distressed Palembang property:

Palembang property in need of renovation
Palembang real estate with a change of puropose and use
Oversold Palembang property
Bank repossessions in Palembang

Put simply, long term investors in Palembang purchase the property, renovate it and make it a lot more attractive to potential buyers.

Calculate profit that you make from Palembang investment property flipping:

Final Selling Price less Cost of Purchase less Costs = Profit

Here is an example:

Palembang property purchase price: $220,000

Renovation costs: $20,000

Other costs: $25,000

Property sale price: $400,000

Profit: $135,000

Experienced property developers in Palembang use a minimum profit value of 22% when looking at potential Palembang projects. The reason for this is because there are lots that can go wrong in Palembang property flipping and working on a potential margin of 22% should still leave a good margin of error.

Property Secured Investments is a Private Equity fund that invests in Palembang and many other towns and cities across Europe. The fund is only available to Sophisticated Investors and closed to United States Citizens. While this is not an offer or promotion of the fund, more information can be found at the website

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