Minister Ara prepares regulations for 40-year mortgage tenure scheme
Jakarta (ANTARA) - The Minister of Housing and Settlement Areas (PKP), Maruarar Sirait (Ara), stated that the government is preparing regulations for a home ownership credit (KPR) scheme with tenures of up to 40 years in line with instructions from President Prabowo Subianto.
Ara said the government is currently conducting simulations and preparing various supporting regulations before the long-tenure policy is officially announced to the public in the near future.
“We are preparing it. We are simulating and preparing it. In due time, we will convey it to the public,” Ara said when met after a meeting with Bank BSN President Director Alex Sofjan Noor, which discussed subsidised housing financing in Jakarta on Wednesday.
She revealed that discussions on the 40-year KPR tenure scheme are being conducted intensively, including through meetings with relevant parties in recent days.
According to Ara, the policy is a direct instruction from the President, so the government’s current focus is no longer on discussing the concept but ensuring its implementation is effective and on target.
“Last time, we had a meeting three days ago, on Friday night, late at night we (met). Later, in due time, we will announce it. (The policy plan) is not for discussion, but for implementation,” she said.
The government, she continued, continues to listen to input from various parties in the housing ecosystem, such as banks, developers, consumers, and the National Housing Savings Management Agency (Tapera).
Ara emphasised that the 40-year tenure scheme will be optional, so the public can still choose shorter tenures according to their abilities and needs.
She explained that the public will still have options to choose tenures of 10 years, 20 years, or 30 years, so payment instalment flexibility remains a concern of the government in the policy.
According to Ara, long tenures are deemed suitable for young people such as new civil servants, as well as new members of the TNI and Police who are just starting their careers and need lighter instalments.
She added that the scheme allows debtors to change the loan tenure during the instalment period, so the public can still accelerate repayment according to their respective financial capabilities.
Ara also assured that the public will be allowed to repay the credit faster if their financial condition permits, without being fully bound to the initial loan tenure.
Regarding discussions with the industry, Ara said the government will soon invite banks and developer associations to discuss the technical implementation of the 40-year KPR tenure policy.
She said informal communication with various parties has actually already taken place to ensure the policy is accepted by the entire national housing ecosystem.
According to Ara, the government is still in the communication and focused group discussion (FGD) stage to absorb input before the final regulations are announced to the wider public.
Ara views the long-tenure policy as a pro-people step because it aims to reduce the amount of monthly instalments, making access to home ownership easier and more affordable for the public.
She emphasised that the government is now focused on preparing mature implementation regulations so that President Prabowo Subianto’s noble goal of expanding access to affordable housing can run optimally and conducively.
“The purpose (of the) 40-year (tenure) is just one, to make it cheaper. That’s it, so the people can pay cheaper (instalments), the goal is noble. Well, we are making the regulations,” Ara said.