Govt to keep lid on cheap housing prices
Govt to keep lid on cheap housing prices
JAKARTA (JP): Minister of Public Housing Akbar Tandjung said
yesterday the government would not let the cost of cheap housing
rise, despite developers' requests for adequate profit.
The government would maintain existing policies on cheap
houses, Tandjung said after a hearing of House Commission V for
housing, transportation and tourism.
Tandjung presented a statement to the hearing which said that
the main problem with cheap housing was a supply and demand
imbalance.
He said there was cooperation between government agencies to
try and match supply and demand for cheap houses. The government
was using Tangerang, which needs 350,000 rooms a year for factory
workers, as a test case for cheap housing.
Tandjung said the government has decided to maintain existing
policies because of requests by the Indonesian Real Estate
Association and small developers, who have thin profit margins
because of rising land and materials prices in the last two
years.
The policies include the 1:3:6 allocated ratio of land program
-- which means that six cheap houses must be built for every
three medium-priced houses and one expensive house. This policy
also regulates partnerships between large and small developers.
Tandjung said that, under the land ratio program, developers
could subsidize cheap houses from the proceeds of sales of
expensive houses.
But developers and the association have urged the minister to
increase the Rp 4.9 million (US$ 2,002) base price of cheap
houses by 15 percent so that developers could make sufficient
profit.
Tandjung said the government was trying to help developers by
cutting administrative and permit fees.
"The government remains committed to prioritizing affordable
housing for low-income people," he said.
He said that should demand for cheap housing rise, he would
re-coordinate Bank Indonesia Credit Liquidity's finance for cheap
housing. He plans to discuss this with the Ministry of Finance
and Bank Indonesia (the central bank).
He said he welcomed the possibility of new forms of housing
credit for poor people.
Tandjung said he hoped that the state-owned Bank Tabungan
Negara's mission would continue to finance cheap housing to
anticipate increased demand for it even though the bank would
merge with state-owned Bank BNI.
He said his ministry was setting up methods of management for
cheap-housing developments under state-owned or private
companies.
Bank Tabungan Negara's credit director, Pandamsih, said her
bank had 1.3 million debtors who owed Rp 8 trillion ($3.27
billion). She said the bank had Rp 1.6 trillion ($654 million)
worth of outstanding home loans.
She said that of Rp 800 billion specifically allocated to
cheap housing, Rp 700 billion had actually been lent. (01)