Developing affordable housing for low-income households in developing countries using participative payment

Abstract

Abstract The government of Indonesia attempt to increase the standard living of the low-income households by providing affordable housing. The concept is implemented in Jakarta-the capital city of Indonesia as the pilot project in the past years. However, the operation faces several obstacles, and one of them is the debt of rental fees from the households from 2013 to 2017 about US$ 2,013,888.89 for all affordable housing exist in Jakarta. This research attempt to evaluate the potential business that can be implemented on the site to improve the payment capability from users. Marunda Affordable Housing in North Jakarta and Cipinang Besar Selatan in East Jakarta will be used as the case studies. Pairwise comparison and life-cycle cost approach are adopted to achieve the targeted objectives. The result shows a different type of business that can be applied to both case studies. One is related to marine processing industry, while the other is suitable with the manufacturing industry. Both business proposals generate a significant rate of return above minimum attractiveness rate of return in the related industry.