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Housing developers say gov’t needs to intervene in low end of market

By Luisa Maria Jacinta C. Jocson, Reporter

THE government’s intervention is needed on the mass-housing side of the housing market, where private developers cannot operate because the segment is unprofitable, housing developers said, adding that funding for housing is inadequate relative to the overwhelming demand for units.

Subdivision and Housing Developers Association Chairman George T. Siy said in a video interview that the National Housing Authority’s budget of P4.9 billion is sufficient for “less than 2% of the demand,” which is “among the lowest in the world.”

“It has became unprofitable (for) the low-end producers… this is something that needs to be (addressed) as the government is unable to produce,” he said.

“The private sector wants to help but we want to remind everyone that it is a primarily government role to provide housing… It’s very important to make housing available to the community as we’ve seen in the last five to six years how housing can become a source of unrest… it’s one of the basic needs; people expect to at least have housing,” he added.

“The statistics show that when people own homes, even small ones, economic activity grows because commercial activity grows there. There’s a lot of side benefits, so we should view this as jump starting the economy as well. It is one of the major sectors that drives the economy in most countries,” he said.

Developing housing projects “creates jobs,” which allows workers to afford homes, he said.

The Department of Human Settlements and Urban Development and National Economic and Development Authority recently signed a joint declaration on the adjustment of the price ceiling for low-cost housing from P1.7 million to P2.5 million.

“The government is requiring developers to develop low-end or socialized housing if they are to be allowed to develop the middle or higher-end [housing] so that means they are requiring the private sector to develop affordable housing and there are incentives to do so,” he added.

“We’d like the price ceiling for socialized housing to be adjusted to make them practical, otherwise the production becomes a big loss for the people if they don’t get to buy their houses early. They don’t get to ride and benefit from inflation, so if someone bought it four years ago, they would have doubled their house values already. Calculating the price ceiling based on tax collection should not be the only criterion, so we would like to see adjustments every three years on a practical basis,” he added.

Mr. Siy said that the new administration should continue consulting the industry and streamlining processes through digitalization.

“One thing the (previous) administration did well that we’d like to continue is the coordination and technical working meetings between the public and private sector,” he said, adding: “Digitalization should happen for all sectors.”

Proper land classification and sufficient funding are also necessary to improve the housing sector, according to Mr. Siy.

“It is also very important to rationalize how they classify land for development as it takes a long time (to rezone for best uses) like retail, tourism, and agriculture. It should be about the overall benefit to the country and not just one sector pushing for its own gain. The rules have to be set early and they have to be consistent and practical,” he said.

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