Government Finalises 40-Year Tenor Subsidised Mortgage, Monthly Instalments from IDR 500,000
The Public Housing Savings Management Agency (BP Tapera) has stated that the policy of subsidised mortgages (KPR) with a repayment period of up to 40 years has the potential to broaden public access to housing finance while simultaneously driving growth in the national property sector. BP Tapera Commissioner Heru Pudyo Nugroho said the extended mortgage tenor will make monthly instalments more affordable, thereby increasing the ability of the public to meet banking financing requirements.
“The longer the repayment period, the lighter the monthly instalments that must be paid. This way, people who previously did not meet the banks’ affordability requirements have a greater opportunity to obtain subsidised housing,” Heru said in a statement in Jakarta on Wednesday (24/6/2026).
According to Heru, the scheme allows subsidised housing instalments to range from IDR 500,000 to IDR 700,000 per month. This condition is considered capable of increasing housing affordability for low-income groups, including workers with a monthly income of around IDR 2.8 million.
From an economic perspective, the policy is expected to expand the consumer base in the housing sector, increase demand for subsidised homes, and create a multiplier effect for the construction industry and other supporting sectors. In addition to extending the financing tenor, the government is maintaining a fixed interest rate of 5 percent for landed houses and 6 percent for apartments throughout the credit period. This measure provides cost certainty for the public amid a trend of rising benchmark interest rates.
Previously, Minister of Housing and Settlement Areas Maruarar Sirait stated that the subsidised mortgage scheme with a 40-year tenor had been agreed upon and was ready for implementation. The decision was taken during a meeting of the BP Tapera Committee with several related ministries, following a directive from President Prabowo Subianto to provide more affordable housing financing for the public.