Subsidised Housing Distribution at 30%, Is Farmland Protection a Hurdle?

The distribution of subsidised housing through the Housing Financing Liquidity Facility (FLPP) continues to be accelerated, with a target of 350,000 units set for 2026. As of 23 June 2026, the realisation of FLPP distribution had reached 81,268 units, or 23.22% of the annual target, with a financing value of Rp10.1 trillion. When including homes that have entered the credit agreement stage, the figure reaches 103,003 units, or approximately 29.43% of the annual target. The government is pursuing various strategies to ensure the 350,000-unit FLPP target is met by the end of the year.

BP Tapera Commissioner Heru Pudyo Nugroho stated that the strategies to achieve the target include strengthening target market segmentation, enhancing promotion, bolstering synergy and collaboration, reinforcing digital marketing, and implementing a policy for a maximum FLPP financing tenor of 40 years. However, several challenges are being faced in the programme’s implementation, including the impact of the Protected Rice Field (LSD) and Raw Rice Field (LBS) policies on the issuance of permits and certificates. To address this, the government has issued a Joint Decree between the Minister of Home Affairs and the Minister of Agrarian Affairs and Spatial Planning/National Land Agency as a solution to accelerate the process.

Furthermore, the implementation of relaxation measures for the Financial Services Authority’s (OJK) Financial Information Service System (SLIK) is also a focus. The OJK has provided support through several policies, including accelerating the updating of reporting data for settled loans, limiting the credit value information displayed in SLIK, and granting direct access to BP Tapera to check SLIK data. The government has also officially implemented a mortgage scheme for FLPP of up to 40 years. For subsidised landed houses, the government is reviewing an instalment scheme of around Rp500,000 per month through a tiered interest rate, while for subsidised flats, the target is an instalment of around Rp700,000 per month using the same mechanism.

Minister of Housing and Settlement Areas Maruarar Sirait confirmed that the mortgage interest rate for FLPP landed houses remains at 5% and for subsidised flats at 6% until the end of the tenor period. He added that BP Tapera has been asked to work harder to reach the target, coordinating with banks and developers, and noted that the President has provided free Land and Building Rights Acquisition Duty (BPHTB) and free Building Approval (PBG).