Builders told to subsidize customers<\/p>\n
JAKARTA (JP): Indonesian Real Estate (REI), the association of
\nreal estate and housing developers, has called on members to
\nsubsidize their customers.<\/p>\n
REI chairman Edwin Kawilarang said Wednesday the subsidy could
\nbe given by offering interest rates lower than what the banks
\ncharged.<\/p>\n
\"If the developers do not provide the subsidy, people will
\nstop buying houses under the current tight monetary policy. As a
\nresult, developers will not be able to pay their loans to the
\nbanks,\" he said.<\/p>\n
Edwin said with the current lending rates of 25 percent to 30
\npercent no one would buy houses and those who had bought one
\ncould not exercise their routine loan installment.<\/p>\n
If this happened, housing developers would receive no money
\nfrom their buyers to pay their loans, he said. \"As a result, they
\ncould collapse,\" he added.<\/p>\n
He said subsidizing the buyers would pose a financial problem
\nto developers, but it would be better than a downfall.<\/p>\n
The loss, he said, could be offset from their previous gains.<\/p>\n
Bank Indonesia raised its key interest rates early last week
\nto between 20 percent and 30 percent to stabilize the falling
\nrupiah. Commercial banks also raised their deposit rates 20
\npercent to 30 percent. As a result, analysts estimated lending
\nrates could reach between 24 percent and 35 percent as compared
\nto 21 percent to 24 percent last month.<\/p>\n
Subsidizing customers would only be a temporary measure, he
\nsaid, because if developers were required to give a subsidy for a
\nlong time it would be detrimental to their businesses.<\/p>\n
He therefore called on the government to ease the tight
\nmonetary policy as soon as possible. (aly)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/builders-told-to-subsidize-customers-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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