Jakarta. Housing and Resettlement Minister Maruarar Sirait has warned that property developers failing to meet quality standards in government-subsidized housing projects could be blacklisted and denied future funding.

Speaking on Tuesday, Maruarar said that the state budget covers 75 percent of the costs for these projects, making any misappropriation a financial burden on the government.

His ministry has reached out to the Association of State-Owned Banks (Himbara) to halt credit access for developers placed on the blacklist.

“I have instructed banks under Himbara to stop offering business opportunities to irresponsible developers who fail to fulfill their commitments,” Maruarar said.

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The government’s subsidy program aims to help low-income families purchase affordable homes while ensuring profitability for developers. However, Maruarar revealed that some developers have delivered substandard housing that does not meet contractual agreements.

He stressed that the government is committed to providing quality homes and will not tolerate mismanagement.

“President Prabowo [Subianto] has directed me to ensure that subsidized housing is built to proper standards and that funds are used appropriately. I will not give second chances to irresponsible developers because I am committed to delivering the best for the people,” he said.

Maruarar cited a developer who built a government-funded housing complex in Bekasi as an example of a contractor that delivered poor construction quality.

“I recently inspected the project site in Bekasi, and despite no rainfall, it was flooded. Just eight months after completion, cracks had already appeared on house floors,” he noted.

In Greater Jakarta, subsidized houses are priced at around Rp 170 million ($10,386) — significantly lower than the metropolitan market standard.

To address the housing backlog, Prabowo’s administration aims to construct 3 million houses nationwide this year.

Meanwhile, Bank Indonesia Governor Perry has agreed to substantially increase liquidity subsidies for commercial banks issuing housing loans, raising the fund allocation from Rp 23.2 trillion to Rp 80 trillion ($1.4 billion to $4.9 billion).

Maruarar said this significant boost would allow his ministry to double the number of subsidized houses from the current projection of 220,000 units.

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