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Jakarta Post

Government doubles down on building more, better-quality homes

  • Norman Harsono

    The Jakarta Post

News Desk   /   Thu, January 24, 2019   /   01:38 pm
Government doubles down on building more, better-quality homes The colorful facade of newly built subsidized houses stand in a row in Kaliwungu, Kendal, Central Java. (Antara/Aditya Pradana Putra)

Amid its claims of success for President Joko “Jokowi” Widodo’s One Million Houses program last year, the government is planning this year to build another 1.25 million new houses of better quality.

The housing program that Jokowi launched in 2015 aims to reduce the country’s housing backlog from 7.6 million in 2015 to 5.4 million this year, especially for lower-income families. In the three years since its launch, the program has built 3.45 million housing units. 

The subsidized housing units are small, two-bedroom rectangular houses and apartments that start from Rp 130 million (US$9,196). People earning incomes of less than Rp 4 million may apply for houses, and those earning less than Rp 7 million may apply for apartments.

The Public Works and Housing Ministry is managing the program this year with the National Development Planning Agency (Bappenas), which has been tasked with improving quality control for the subsidized housing units, including assessing the units' access to water and sanitation.

Bappenas expert staff Oktorialdi Ilyas said that fulfilling the task was part of the agency’s commitment to incorporating the Sustainable Development Goals (SDGs) into its medium- and long-term development plans from 2020 onwards.

Goal 11 of the SDGs is Sustainable Cities and Communities, which urges governments worldwide to make cities and human settlements inclusive, safe, resilient and sustainable. The measures to attain this includes ensuring people's access to safe and affordable housing.

Oktorialdi said that only 60 percent of all households in the country had access to clean water, while only 73 percent had access to sanitation.

“Only 36.58 percent of all houses are inhabitable,” said Oktorialdi, citing Bappenas data.

However, the government-sponsored housing units were also hampered by quality control problems. Consumers and development experts have criticized the low quality of the subsidized units, and homebuyers have reportedly complained about finding out that their new homes were poorly constructed.

The Public Housing Developers Association (Himperra) reported a 20 percent decrease in the construction of landed houses in February-April 2018, due to consumers demanding better quality housing following complaints over leaky ceilings and peeling walls. 

“Social media allowed homeowners to reveal technical flaws in the [housing units] directly to the public works and housing minister, which prompted higher demand for [better quality housing],” Himperra chairman Harry Endang Kawidjaja said at a recent event in Jakarta.

Soelaeman Soemawinata, the Asia-Pacific regional president of the International Real Estate Federation, told The Jakarta Post that he supported tighter quality control because good accessibility “should have been there” when the units were built.

Khalawi Abdul Hamid, the ministry’s housing procurement director general, said he expected to be allocated Rp 17.6 trillion from the state budget to support the housing program this year.

Forty-three percent of the fund would be used to finance the construction of 215,000 units, while the remaining 57 percent would go toward the housing loan subsidy.

The government has invited more private investors to finance of the housing program to reduce the state budget burden, offering them incentives like eased construction licensing and private-public partnership schemes. 

Last year, the government built 1.13 million subsidized housing units, half of which was financed through a Rp 9.6 trillion fund from the state budget, while the private sector provided the remainder.