Prolonged Rainy Season Delays Projects, Slowing Mortgage Disbursement

Prolonged rainy season last year impacted the housing sector. The house construction process was disrupted, resulting in slower mortgage (KPR) disbursements.

BTN President Director Nixon Napitupulu stated that the slowdown primarily occurred in the subsidised housing segment, which depends on physical construction progress.

“Housing trends are always slower during the rainy season and faster in the dry season,” Nixon said in Bandung on Thursday (9/4/2026).

Mortgage agreements can only be conducted after construction is fully completed. Weather conditions are the main factor in this process.

“Subsidised mortgages cannot be agreed upon if the house is not 100% complete,” he said.

Rain arriving earlier from October to November delayed construction work. Unit completions were postponed, and credit realisations were also pressured.

“The rainy season came early from October-November. Physical work was hindered, and growth became slower,” Nixon said.

BTN assesses that weather factors are often overlooked when reading the performance of the housing sector. Reliance on manual labour makes construction sensitive to field conditions.

The Ramadan and Eid periods also slowed construction. Many construction workers temporarily halted activities.

“Indonesia hasn’t used digital tools for building houses yet; it still relies on craftsmen. During the fasting month, the craftsmen go home,” Nixon said.

BTN views this slowdown as not reflecting a decrease in demand. The main constraint is on the supply side because units are not yet ready for agreement.

Accelerating construction during the dry season is considered important to catch up on mortgage disbursements in the housing sector.