Home sweet home?
Some 200 people, claiming to represent 3000 prospective buyers, staged a noisy demonstration last Monday at a local police precinct in East Jakarta. Unfortunately, they failed to catch up with the director of a housing developer who was being detained there. Dissatisfied, the group went to the House of Representatives to lodge their complaint.
The protesters claimed they were cheated by the developer when, after paying down payments from Rp 700,000 to Rp 2 million, they found out that the housing development project was a hoax. The developer is believed to have pocketed at least Rp 3 billion in the scam.
Similar reports surface from time to time and always the same pattern emerges: Eager prospective buyers of low-cost and medium- cost housing pay a down payment to the developer, who lures them with "model" houses. When delivery time comes, however, it turns out that the houses are nowhere to be seen. Nine such cases have been reported so far.
Much-improved economic conditions, particularly over the last decade, have spawned a boom in the country's real estate business. As we can see, new housing and apartment projects are sprouting up in almost every city as the demand grows to unprecedented levels. So big is the boom that last year monetary officials called on banks to slow down their granting of credits and to be more selective in giving out loans for housing development for fear of overheating the economy.
Faced with such a lucrative market, some slick operators have seen the opportunity to grab some easy money. A lack of government control, poor supervision and possible collusion between officials and developers allow them to operate easily.
One striking fact is that most of the victims are prospective buyers of low and medium-cost houses. Obviously, it is easier for the swindlers to attract the lower classes of our society, as middle and upper-class people usually are more cautious and only willing to deal with bona fide developers.
We welcome President Soeharto's order instructing the State Minister of Public Housing to step up efforts to reduce the incidence of housing fraud. To let those slick developers continue cheating low and middle-income people is not only outrageous, but immoral and inhuman.
Tightening measures against dishonest developers, however, is not sufficient. The Association of Real Estate Companies, possibly with the help of the Indonesian Consumers Protection Agency and the media, could help prevent prospective buyers from falling into these traps. The media, which has enjoyed the real estate sector's lucrative advertising funds for years, could help by investigating dubious housing developers.
We also should hail President Soeharto's order, which enforces the balanced-housing concept by requiring developers to build six low-cost and three medium-cost houses for every one luxury house. Because many developers have chosen to ignore this rule, luxury housing complexes have mushroomed throughout Jakarta.
What those developers seem to forget, however, is that by only building luxury houses, which are undoubtedly more profitable, they have planted a time-bomb. Many homeless people believe the new houses are built only for "the haves". History has shown that social envy and social gaps can trigger explosions of turmoil and unrest. And we certainly do not want such things to happen here.