Government Prepares Regulations to Extend Home Loan Terms to 30 Years
JAKARTA — The Ministry of Housing and Settlement Areas (PKP) is preparing a policy to extend the tenor of subsidised home purchase loans (KPR) to 30 years.
This measure is intended to expand homeownership access for low-income earners (MBR) and middle-income earners (MBT).
Housing Minister Maruarar Sirait stated that the policy is part of the government’s efforts to reduce the burden of household instalments to make them more affordable.
“Until now, the maximum tenor has been 15 or 20 years. We are now extending it to 30 years so that instalments become lighter,” Sirait said following a Tapera Committee meeting in Jakarta on Thursday (26 February 2026).
The government is implementing various tax reliefs including exemption from the Land and Building Rights Acquisition Tax (BPHTB), exemption from Building Permits (PBG) for low-income earners, and government-absorbed Value Added Tax (VAT) on purchases of new homes or apartments up to Rp 2 billion, which has been extended through 2027.
In addition to low-income earners, the government is also preparing a special financing scheme for middle-income earners featuring a fixed interest rate of 7 per cent for 15 years and tenor extending to 30 years.
Under this scheme, prospective borrowers need only prepare a 1 per cent down payment.
The government also provides a subsidy of Rp 25 million to cover initial costs such as fees, notarial services and insurance, and covers VAT in full.
Finance Minister Purbaya Yudhi Sadewa endorsed the policy, arguing that extending the tenor can expand access to housing credit for the public.
According to him, the policy is also expected to encourage banks to expand housing loan disbursements with longer tenors, allowing the housing sector to grow faster and generate broader economic benefits.
The government is currently refining regulations related to the 30-year tenor scheme before it is widely implemented through the national housing financing programme in cooperation with BP Tapera.