40-Year Mortgage Tenor Makes Farmers and Labourers Easier to Buy Homes

Minister of Housing and Settlements (PKP) Maruarar Sirait said that the subsidised Mortgage Ownership Credit (KPR) scheme with a tenor of up to 40 years can broaden access for low‑income groups to own a home. He said the policy is a follow‑up to the President’s directive to make subsidised housing instalments lighter and more affordable. ‘We also discussed follow‑up to the President’s directive regarding the tenor of subsidised home loans up to 40 years so that instalments for the public are lighter,’ Ara, as he is popularly known, was quoted on Tuesday (19 May 2026). He explained that the government has prepared a simulation of subsidised home instalments in Java and Sumatra with a price of IDR 166 million. ‘As a simulation, subsidised homes in Java and Sumatra priced at IDR 166 million currently have instalments of around IDR 1,058,000 per month for a 20-year tenor. If the tenor is extended to 40 years, the instalment could drop to around IDR 773,000 per month,’ he said. Maruarar assessed that the reduction in monthly instalments could open up greater opportunities for groups such as labourers, farmers, informal workers, and young people to buy their first home. ‘This will widen opportunities for labourers, farmers, informal workers, young people, and low‑income households to own a decent home,’ he continued. ‘However, this 40-year scheme is optional, depending on the ability and choice of each community,’ he added. In addition to discussing subsidised home loans, Maruarar also highlighted the importance of housing development that considers environmental aspects. He said home construction should not only chase the number of units, but also pay attention to environmental quality through a tree‑planting movement for every new home. ‘We want housing development not only to focus on the number of homes, but also on environmental quality. If millions of homes are built and every home plants one tree, the impact will be very large for Indonesia’s future environment,’ he stated. Meanwhile, the Housing Savings Management Agency (BP Tapera) has examined a simulation of subsidised KPR instalments with a tenor of up to 40 years, which is considered capable of broadening access for low‑income households to own a home.