Industry Requests Adjustment on Socialized Units Following Price Cap Increase
The Organization of Socialized and Economic Housing Developers of the Philippines (OSHDP) and the Socialized Housing Alliance Roundtable Endeavor (SHARE) said it might be difficult for them to attain the government’s housing targets and the overall goals under the Medium Term Development Plan of some 443,303 units for the period 2020 to 2022 or an average of some 147,767 units per year.
Socialized housing developers oppose the Housing and Urban Development Coordinating Council's adjustments to housing standards and price caps (HUDCC).
The Organization of Socialized and Economic Housing Developers of the Philippines (OSHDP) and the Socialized Housing Alliance Roundtable Endeavor (SHARE) have stated that it may be difficult for them to achieve the government's housing targets and the overall goals under the Medium Term Development Plan of approximately 443,303 units for the period 2020 to 2022, or an annual average of approximately 147,767 units.
This is due to the changes in requirements that preceded the revision of the price cap for public housing.
The joint National Economic and Development Authority-HUDCC Resolution imposed a new price ceiling of P480,000 for 22 square meters with a loft of at least 50 percent of the base structure or 24 square meters; P530,000 for 24 square meters with a loft of at least 50 percent of the base structure or 28 square meters; and P580,000 for 28 square meters with a loft of at least 50 percent of the base structure or 32 square meters.
In 2018, the prior ceiling was set at P450,000.
The president of the OSHDP, Jefferson Bongat, has stated that the price modifications and associated increases in design criteria for socialized housing projects are not feasible and are unreasonable.
According to Bongat, the new increases in the floor areas of different tiers of communal housing and the resulting increase in lot sizes necessitate increases of six, ten, and fourteen square meters, respectively.
“The loft requirement of 50 percent of the base structure has further eroded whatever adjustment in the price ceiling. It will be difficult for developers to produce socialized housing under these requirements, especially in urban and highly urbanizing areas as this will entail additional construction costs,” Bongat said.
“The unrealistic adjustments in standards and price ceilings will adversely affect the participation of housing developers in the National Shelter Program of the government and will slow down the production of socialized housing. The housing backlog of six million units will continue to spiral, greatly affecting the supply and access for decent and affordable housing, especially for the lower income groups of the population,” Bongat added.
SHARE president Marcelino Mendoza stated that labor costs in Metro Manila had climbed by 4.9% to P573 per day, which is compounded by increased competition for both experienced and unskilled labor for the government's Build Build Build program.
OSHDP and SHARE are encouraging the government to swiftly address this concern and reconsider the revisions to the price ceiling and criteria, as this will have ramifications for the housing industry and the broader growth and development of the economy.