5 Housing Policies in Singapore that Can Be an Inspiration for Jakarta

Almost 80 percent of Singaporeans live in flats owned by the Housing & Development Board (HDB). Various policies are in place to make this happen. The Singapore Government argues that home ownership increases attachment, maintenance, work ethic, and a sense of belonging to the neighborhood.

Check out some of the housing policies implemented by the Singapore Government:

1.Use of Central Provident Fund (CPF) for flat purchase

Housing affordability in Singapore is done by allowing the use of the Central Provident Fund (CPF) for flat purchases. CPF is similar to BPJS Employment contributions in Indonesia.

The CPF is a welfare fund with contributions from citizens' income. Singaporeans are required to pay 37 percent of their monthly salary, with 20 percent for workers and 17 percent for employers.

Of the total savings in the CPF, 23 percent can be used for home buying purposes. This eases the monthly installments that people have to pay.

2.Full government support and commitment to HDB

This is in the form of subsidized assistance to residents for loans, home ownership credit schemes that suit their abilities, and operational costs of flat units. This way, HDB can focus on building and managing apartments owned by the organization.

3.Financial policies that support home ownership

Financial policies are crucial to creating housing affordability. In Singapore, this takes the form of:

1. Flat monthly installments capped at 30 percent of monthly income.
2. The long repayment tenor is a maximum of 25 years or can be paid until the age of 65.
3. The loan-to-value offered by HDB is also a maximum of 90 percent.

The financial policy comes with a strict financial risk assessment for prospective buyers to prevent arrears, defaults or failure to pay. Prospective flat buyers are only allowed to purchase the type of flat they can afford.

4.Provides a variety of housing options

Singaporeans can choose the type of flat/flat/apartment size they can afford and need.

5.Determining the terms of flat buyers

HDB stipulates that subsidized flats/apartments are only for families with a maximum income limit. Non-families are also eligible with a minimum age limit of 35 years. After occupying a flat, they are prohibited from renting it out/selling it in the first five years of ownership to prevent a speculative market.

Providing affordable housing in the middle of the city is not impossible. Commitment and intervention from the government is one of the main keys. Let's make Jakarta more affordable.