Developers ask for hike in low-cost house prices<\/p>\n
JAKARTA (JP): The government will consider private developers'
\ndemand that the price of low-cost houses be raised, but will not
\ngrant an increase if it is satisfied that the developers can
\nstill make a profit, according to State Minister for Public
\nHousing Akbar Tandjung.<\/p>\n
\"Many private developers have urged me to raise the sale price
\nof low-cost houses and we will discuss their demand next month,\"
\nTandjung told reporters during a break in a hearing with
\nCommission V of the House of Representatives yesterday.<\/p>\n
He said that developers have complained about the rising
\nprices of land and construction materials which, they claimed,
\nwere reducing their profits.<\/p>\n
\"But first I will study their profit margins; whether they
\nreally have dropped,\" he said.<\/p>\n
Tandjung said that developers were spending more on license
\nfees and infrastructures construction.<\/p>\n
He refused to disclose the extent of the price rise sought by
\nthe developers.<\/p>\n
Low-cost houses currently cost between Rp 4.5 million and Rp
\n11.9 million (US$2,091-$5,409) each.<\/p>\n
The state-owned Bank Tabungan Negara has recently announced
\nplans to lower interest rates on its loans for the purchase of
\nlow-cost houses from its current level of 16 percent per annum in
\norder to encourage developers to build more such houses.<\/p>\n
The growth of the construction of low-cost houses has been
\nslower than the growth of demand.<\/p>\n
For the sixth Five Year Development Plan (Repelita VI) period,
\n1994-1999, the government has set a construction target of at
\nleast 500,000 low-cost houses, of which 200,000 should be
\nconstructed by private developers grouped in the Indonesia Real
\nEstate Association, 250,000 by the state-owned developer Perum
\nPerumnas and 50,000 by cooperatives.<\/p>\n
The minister, who declined to reveal how many units have been
\nconstructed in the first year of the plan, said yesterday that
\n100,000 low-cost houses should be constructed each year within
\nthe Repelita VI period.<\/p>\n
Under a joint decree signed by Ministers of Public Housing,
\nHome Affairs and Public Works, private developers are required to
\napply a 1:3:6 housing scheme, meaning that they should build six
\nlow-cost houses and three medium-cost ones for each luxury house
\nthey build. (icn)<\/p>",
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