Ara Ready to Accelerate New Rules for 40-Year Home Ownership Loan Instalments

Minister of Housing and Settlement Areas (PKP) Maruarar Sirait, or Ara, has stated that she is ready to prepare new regulations regarding the tenor of subsidised home ownership credit (KPR) up to 40 years for workers. This step is said to be a direct directive from President Prabowo Subianto to lighten the instalments for workers. Ara mentioned that the government had previously extended the tenor of subsidised KPR from 20 years to 30 years. However, following the directive from Prabowo, the government is now preparing new regulations so that the instalment tenor can reach 40 years. According to her, this policy aims to help the public by making the burden of housing instalments lighter. She emphasised that there is no personal vision of the minister in this policy, but rather executing the President’s vision. “There are no visions of the Minister; what exists are the visions of the President,” Ara stressed. Ara explained that the longer the instalment tenor, the smaller the monthly instalment amount will be. She gave an example that subsidised housing instalments with a 10-year tenor could reach around Rp1.7 million per month, 15 years around Rp1.4 million, and 20 years around Rp1 million to Rp1.1 million per month. With a 40-year tenor scheme, according to Ara, subsidised housing instalments have the potential to drop to around Rp800,000 to Rp900,000 per month. Regarding the issuance timeline of the regulation, Ara assured that the government will prepare it soon together with stakeholders. “We will prepare it soon. We will involve the banks, the prospective subsidised housing recipients, the developers, so that the regulation can be implemented,” she said. She added that the government has also requested the formation of an association for apartment residents and subsidised housing residents as a forum for communication among the beneficiaries of the housing programme.