TEMPO.CO, Jakarta - Finance Minister Sri Mulyani Indrawati said Indonesians might find it increasingly difficult to purchase a house in the midst of global economic turmoil. The current economic condition, which forces a number of central banks to increase their interest rates, will bring an impact on the housing sector.

“The mortgage term for buying a house is 15 years. It’s hard [to pay] the interest rate in the beginning, and then pay off the principal. With the house prices and interest rates that tend to rise along with high inflation, people are getting more difficult to buy [a house],” said Sri as quoted from Antara, Wednesday, July 6, 2022.

The US central bank, The Federal Reserve System, or The Fed, planned to announce an increase in interest rates in the near future following high inflation due to spikes in food prices.

Sri said this potentially leads to the hike in interest rates for home ownership credit (KPR), making it more difficult for people to buy a house.

Therefore, the former managing director of the World Bank made sure that the government would focus on using state finances to help low-income people to buy a house. This reflects the principle of justice in the use of state finances.

“What we need to address for Indonesia's development is the equality that those who can't afford [buying a house] can be helped through various instruments,” said Sri Mulyani.

ANTARA

Click here to get the latest news updates from Tempo on Google News