Housing “Backlog” Has Reached 15 Million Units, Local Areas Need to be Considered

JAKARTA, KOMPAS – The government has stated that the number of housing shortages has increased to 15 million units. Various efforts are being made, including seeking additional financing for housing development. Local governments hope that housing issues can be addressed according to each cultural characteristic, rather than being generalized across regions.

Deputy Minister of Housing and Settlement Areas (PKP) Fahri Hamzah said, citing data from the Central Statistics Agency (BPS), the housing backlog will reach 15 million units in 2025. This figure is an increase of 51.5 percent from the data of 9.9 million units recorded in the 2023 BPS National Socio-Economic Survey (Susenas).

"Because the market is expanding, the need for housing queues is increasing. Previously, we heard the figure of 9.9 million (units) from BPS. I have confirmed that it has risen to 15 million. Meanwhile, the number of uninhabitable houses has neither increased nor decreased, remaining at around 26 million houses," said Fahri during the Technical Coordination Meeting on Rural Housing in Jakarta, Tuesday (29/4/2025).

The government is trying to prepare funds for the construction and renovation of houses. One of them, the Ministry of PKP has visited several countries and met with multilateral development banks. Fahri claims that his party has received quite a large amount of funds, but is reluctant to mention the amount.

In order to address the rising land prices amid limited land availability, the government is also working to provide housing through state-owned lands within the city. Land prices will serve as a subsidy element for the state, once land matters and permits are resolved.

Not only that, urban areas will also focus on the arrangement of regions to address slum areas and improve the quality of life for residents. This will be facilitated by vertical housing, although the habit of living in multi-story residences has not yet become as popular as living in landed houses.

The government is striving to translate this concept into a program for the construction of 3 million houses. The budget allocated is already available, thus regional heads need to promptly prepare their systems.

"We have prepared funds because local governments in our system are not allowed to borrow or incur foreign debt. Investment is permitted, but not borrowing. However, we at the central level can, as there is money available and in abundance. That target is not too difficult, as it depends on our ability to absorb the budget," said Fahri.

So far, the central government assesses that the unpreparedness to disburse funds is due to the system not being adequately prepared. President Prabowo Subianto's program will only be optimal through the State Budget (APBN) 2026, as the previous budgets still follow the previous administration's period.

"Our budget is in the 2025 State Budget that was ratified during the era of Mr. Joko Widodo, but the renovation alone is only Rp850 billion, not even Rp1 trillion. That can only cover less than 40,000 (housing units), around 35,000 housing units," said Fahri.

Based on data as of April 28, 2025, the potential land for rural housing is approximately 1,000 hectares (ha). This consists of assets from the land bank agency (485 ha), land identified as abandoned (683 ha), and village treasury land that is still in the process of identification.

Fahri stated that the government plans to establish 80,000 red and white village cooperatives. One of its functions is intended to serve as a housing cooperative to enhance the aspect of mutual cooperation among residents.

Data related to uninhabitable houses presented by the central government is considered invalid because it does not reflect conditions on the ground.

At the same event, the Expert Staff of the Minister for Inter-Agency Relations of the Ministry of Villages and Development of Disadvantaged Regions, Sugito, stated that they have renovated 25,184 housing units in 2024. The fund absorption is approximately Rp 397 billion.

They encourage the management of home renovations through self-management to ensure the continuity of economic circulation in the village, including through cash-intensive labor. Two of the approaches involve utilizing raw materials and employing local labor in the village.

Nevertheless, he reminded that the characteristics of each region cannot be generalized. Each region has its own distinct features. This needs to be synchronized in the Regional Medium-Term Development Plan (RPJMPD), so that the quantity of uninhabitable housing needs and the construction of new houses is clearly depicted.

"This is two different matters. Data needs to be validated, so that when validated, it aligns with the needs that may become a priority scale," said Sugito.

Houses are a hallmark of the culture of society. Consequently, the development of local community needs must also be accommodated to remain relevant. The formulation of housing standards must include the existing local conditions.

This also accommodates the aspirations of several regional heads. They believe that the housing needs in each region vary because the issues faced are not the same.

According to the Deputy Regent of Ketapang, West Kalimantan, Jamhuri Amir, his administration's area requires home renovations more than the construction of new houses. This approach is considered more effective and efficient. He also emphasized that the data related to uninhabitable houses presented by the central government is deemed invalid as it does not reflect the current conditions on the ground.

Complaints regarding housing needs were also expressed by the Deputy Governor of Papua Pegunungan, Ones Pahabol. Instead of renovations, he believes that the people in his region are in greater need of new homes.

"Regarding Papua, there is no land problem. So, flats are not needed, landed houses are needed," said Ones.

Houses currently available in the Papua Mountains are of types 45 and 72. However, these types are considered inadequate to accommodate the current conditions, as it is not only the husband, wife, and children who live under one roof. This phenomenon is a consequence of the large number of residents who are unable to access affordable housing due to excessively high prices.