/2011/08/18/1032186368p.jpg)
JAKARTA. The most awaited war has come and it is not the armed conflict but it is the competitive interest rate mortgage loan war (KPR) that is getting lower. Nobody would have thought that the mortgage rate in this year managed to achieve a single-digit number after the previous years had always been above 10%.
In the face of property bubble, the competition in this segment is even more stringent. Banks are competing to offer a low-interest package through a billboard plastered on the streets of Jakarta.
For example, PT Bank Mandiri Tbk (BMRI) is offering a fixed-mortgage rate at 6.75% which is valid for several years (See the table). If the agreement period is expired, the bank implements a floating interest rate or follows the mechanism of market interest until the mortgage is paid off.
The bankers claimed, the application of low interest rate in the early year of the mortgage is the strategy of banks to attract customers at post regulation of Bank Indonesia (BI), which sets a minimum down payment 30% from house price. Since the rule is valid on June 15, 2012, the banks immediately set a strategy in ensuring the continuity of mortgage business.
One of the most aggressive banks which offer a single digit mortgage rate is PT Bank Central Asia Tbk (BCA/BBCA). In the beginning of last year the bank that is affiliated with Djarum Group established a fixed mortgage rate 9% for the first two years. Starting in October 2012 BCA dares to give 8.5% interest mortgage. Even the low interest rate is given fixed for 5 years.
Director of Consumer BCA, Henry Koenaifi forthright, thanks to the offer of mortgage rate ramp, the growth disbursement of mortgage during the first nine months successful was 5% higher than the set target 25%.
"In 2012 the BCA portion mortgage reached 16% from the total bank loans. The details, about Rp40 trillion from Rp250 trillion," he explained. This year, BCA hopes disbursement mortgage growth minimum 20%.
Tenor fixed interest widens
Having seemed not to be outdone by private banks, financial institutions, State-Owned Enterprises (BUMN), PT Bank Negara Indonesia Tbk (BBNI / BNI) also holds a similar promo. The trend can be inferred that there is a war flaming up when the bank does not impose a fixed rate for two years. With a five-year period, low interest rate given is longer and lower, who’s not to be tempted?
From previously perched on level about 9%, BNI lowered its mortgage rate by a promo called BNI Griya Bunga Cantik. This promo is divided into three types with a different interest rate and loan amounts. The first type is the fixed interest rate 6.99% fixed two years for loan more than Rp1 trillion. The second type of loan is 7.49% with Rp500 million - Rp1 trillion. And the third type is 8.49% from Rp250 million - Rp500 million.
Since boosting low interest per 1 October last year, Vice President Consumer and Retail Lending BNI, Indrastomo Nugroho claimed that the total mortgage loan is above Rp1 trillion. He believes, this figure could still rise due to the on-going promo until the end of December.
In addition to the promo, BNI also has a regular mortgage for loan more than Rp500 million with a fixed interest rate of 8% for five years. But don’t be surprised, after the era of fixed is finish, the customer will be charged a 13% floating interest rate.
Indrastomo observed, rather than regular, BNI customers prefer to propose for loans through BNI Griya Bunga Cantik. The trend is the customers prefer to the low interest loans even for the short term, compared with higher interest rate with long term.
"But the difference is only 1%, and it is more stable for five years," he said.
Just for info, after the DP rule of BI is in effect, the distribution of BNI mortgage ever dropped in July 2012. If the distribution during June reached Rp1 trillion, in the second semester BNI only distributes Rp800 billion. The most significant decrease occurred in house priced under Rp1 billion, or about Rp750 million.
In that period, the total distribution of BNI mortgage reached Rp22 trillion. The number increased significantly since in the end of 2011, the remaining outstanding was Rp18 trillion. Indra believes that with nowadays development, BNI remains optimistic to distribute mortgage and achieve more than the main target.
"Until the end of this year, at least the mortgage could rise 30% from Rp18 trillion to Rp24 trillion," hope Indrastomo.
| Name of Bank | Fixed | Floating | Maximum Period |
| BCA | 8.5% (5-year) | follow the market | |
| BNI | 8% (5-year) | follow the market | 20 years |
| Bank BJB | 7.29% (2 years) | follow the market | 15 years |
| Bank Mandiri | 6.75% (2 years) | 9.75% | |
| BTN | 7.49% (2 years) | follow the market | 25 years |
| *Date:2012-2013 |
Low interest rate keep continue
Property analyst, Panangian Simanungkalit assesses that a low interest rate is going to make the real estate business is booming at the end of this year. Banks will keep competing in taking customers. Moreover, referring to the predicted BI rate at 5.75%, banks likely will not bounce mortgage rate in the next years.
"The demand will definitely overflow," he said. He also predicted that the growth will rise 13% next year from Rp95 trillion to Rp115 trillion. "BI policy applying loan to value (LTV) 70% will not prevent people to hunt the property. That is just encouraging people to collect more money to get a mortgage," he explained.
Despite the heated interest rate competition which can make people flock applying for a loan to the bank, he believed it will not cause bubble property.
"Indonesia doesn’t need to be afraid of the property bubble that may ultimately undermine the market price," he said. According to him, the bubble can occur due to overheating caused by credit expansion. The characteristic of the first explosion in property is a rise interest rate.
"Here the trend even goes down," he said. Second, the non-performing-loan (NPL) moves up and out of bounds. Current level 2% is still safe. Third, property loan exceeds 20% of the national credit.
"There is currently up to 15%," he said. So, according to him, the application of low interest rate is still reasonable and it is not threatening the booming of property sector.
Financial Planner: The Customer to pay attention
Of course, the customers should not be easily tempted by any offers from banks. They must be critical in the first purchase than feel sorry later.
Financial planner, Ligwina Poerwo-Hananto through tips at Kontan argues, if there is one permitted debt in financial planning, it must be in the form of debt housing or mortgage as there are not many people can afford to buy a house with cash money.
Well, how to choose a good mortgage?
"It's hard to answer, every bank has a mortgage program and each has its advantages and disadvantages." she said. But, in the judgment of Ligwina, of course there are some technical issues need to be observed.
Fixed versus floating. While mortgage rate set fixed, of course the most supported is customers. A little flashback: in 2008, when interest rate rose in the fourth quarter in response to the global crisis, there were some customers who complained about how they had to deal with floating mortgage rate of 9% per year to 16% per year. Of course, this could have had an impact to their monthly installments.
(But, no one should be wary of). When a bank offers a fixed interest rate of 1 year, there is no agreement whether in the second year the floating rate will be the same as the current interest rate in the market.
In fact, many banks impose a floating interest rate in the second year above the benchmark rate. As the result, many customers complain since they get very high interest rate starting from the second year. Meanwhile, banks that impose a floating rates look unattractive.
"Whereas, historically, the banks which do not impose a fixed interest rate are the least banks that implement fluctuation of interest," said Ligwina. So, in responding to the incessant promo low interest rate from the banks, Ligwina warned the customers to pay attention to the interest calculation system that applied in every bank. (Dyah Megasari Anjaya)
