Finance Minister Sri Mulyani once mentioned the issue of housing that is increasingly unaffordable for Indonesians. The high price of property means that only 20% of the wealthy can afford to buy a house in the formal market.
As much as 40% of the middle class can only own a house with the help of government subsidies. The rest cannot even afford to buy a house at all. In fact, through vertical development, Jakarta can provide affordable housing and get additional green space.
The high price of housing in Jakarta is partly due to the increasingly limited land. Jakarta is the most densely populated city in the world, on par with Tokyo, which has a ratio of 14,000 people per square kilometer. The difference is that the two cities were built in opposite ways.
Tokyo continues to build upwards, implementing vertical development in accordance with the compact city concept. The city government optimizes the potential for increasing spatial density by building tall buildings. Jakarta, on the other hand, still spreads its density horizontally with its low-rise buildings. This development erodes excessive land and leaves little space for housing and green open space.
In addition to limited land, the high cost of housing in Jakarta is also due to high land prices. As a result, the non-subsidized affordable housing built by developers - as a fulfillment of their social obligations - ends up being ineffective.
This is because cheap housing in Jakarta is in areas far from the city center. For example, in Marunda and Rorotan, North Jakarta. Indeed, the price of land in these locations is cheap, but the distance is far from the city center and transportation access is difficult. This is not attractive to low-income people who work in the city center. In fact, Jakarta as a business center certainly needs services that support the company's daily operations.
Another problem that makes housing in Jakarta expensive is the lack of visionary spatial planning. Published in 2014, the Jakarta 2030 spatial plan lacks vision and breakthroughs in land use. The plan was designed with projections of population growth and economic growth that were too conservative.
Jakarta's population is expected to increase by only 20% to 12 million from 2014 to 2030. This prediction could be true, considering that from 2000-2014 the city's population only increased by 20% from 8.4 million to 10 million.
It should be noted that during the same period, the capital's economic growth skyrocketed 187%. During that period, Jakarta grew rapidly as a business center, but residents of the capital city moved to surrounding cities such as Tangerang, Bekasi, Bogor, Depok, and others where cheap housing can still be found. This is what the projections missed.
Jakarta simply cannot continue to rely on its surrounding areas to fulfill the housing needs of its residents. This means longer distances and more tiring commutes to the capital city. It also means higher levels of congestion and air pollution in Jakarta. Not to mention, the loss of water catchment areas and agricultural land in the cities surrounding Jakarta.
Therefore, the first step is to improve urban planning. The rapid population growth is a factor that must be considered and cannot be avoided. For this reason, Jakarta must start building vertical housing as an application of the compact city concept which can be a solution to the city's problems.
The presence of the Jakarta MRT could actually be the key to more efficient land utilization in the capital city. This is reinforced by the Minister of Agrarian and Spatial Planning Regulation No. 16/2017 on Guidelines for the Development of Transit-Oriented Areas or TOD areas.
This regulation supports space densification at transit nodes. This means that Jakarta has the opportunity to utilize land around MRT, LRT, BRT and commuter train stations for vertical development.
Ideally, buildings are designed to be integrated and multipurpose for people with different income levels. That way, the positive effect is the creation of affordable housing in Jakarta that is integrated with public transportation and the presence of green open space in the area. Thus, the percentage of green open space fulfillment in Jakarta can at least show an increase.
Jakarta's city planning needs to be revised in order to adopt the ideal TOD concept as mandated by Permen No. 16/2017. This spatial revision is planned to be carried out in 2019 to accommodate additional space for affordable housing in Jakarta.
Not only improving the spatial plan, efforts to implement vertical development in the Jakarta TOD area need to be supported by subsidy policies in the form of land provision in strategic locations. Otherwise, the development of affordable housing in Jakarta will end up in unattractive locations and difficult transportation access such as Marunda and Rorotan.
The problem of strategic land availability can actually be solved if the government is willing to make a breakthrough. One of them is to cooperate with BUMN / BUMD to optimize their land assets. This is because many SOEs / BUMDs have one or two-story buildings on a fairly large area of land in Jakarta. The building can be utilized for the development of mixed-use buildings. For example, markets owned by BUMDs and terminals.
Imagine if the market buildings were raised again to make cheap flats for the underprivileged. The work can be done by developers through their social obligation program.
This method certainly benefits all parties. BUMD/BUMN gets additional revenue from optimizing the use of Building Floor Coefficient used by developers, developer obligations are fulfilled, the market is getting crowded, and the community gets cheap housing in strategic locations in Jakarta.
Once Jakarta residents start moving from conventional housing to vertical settlements in TOD areas, it is certain that there will be additional land in the capital city that can be used as green open space. There is only 10% green open space in Jakarta, far below the Jakarta Spatial Plan target of 30%.
Improved spatial planning and vertical residential development in TOD areas results in land use efficiency, affordable housing, and increases the percentage of green open space in Jakarta. Let's build upwards!