Published on December 11, 2013, Manila Bulletin:

Written by Charlie Gorayeb

In a resolution passed by the Housing and Urban Development Coordinating Council (HUDCC) board last Oct. 16, the price ceiling for socialized housing was raised from P400,000 to P450,000 effective this month.

This represents an increase of about 16 percent based on a joint evaluation by the Council and the National Economic and Development Authority (NEDA) which took into account the price of raw land, construction materials and the consumer price index, among others, as proposed by the private sector.

The 1987 Constitution mandates the State to undertake, in cooperation with the private sector, “a continuing program of urban land reform and housing which will make available at affordable cost, decent housing and basic services to underprivileged and homeless citizens in urban centers and resettlement areas.”

Republic Act 7279 or the Urban Development and Housing Act (UDHA) of 1992 defines socialized housing as “housing programs and projects undertaken by the Government or the private sector for the underprivileged and homeless citizens which shall include sites and services development, long-term financing, liberalized terms on interest payments, and such other benefits.”

Republic Act 8763 or the Home Guaranty Act of 2000, on the other hand, states that the ceilings for socialized, low-cost, medium cost and open housing shall be jointly determined by HUDCC and NEDA, provided that at any time, but not more often than two years, such ceilings may be reviewed in conformity with prevailing economic conditions.

On Dec. 11, 2008, the HUDCC issued Resolution No. 1 which adjusted the socialized housing ceiling from P300,000 to P400,000 per unit. This was based on a joint review and assessment by HUDCC and NEDA which concluded a 31.1 percent growth in housing construction and repairs on the Consumer Price Index (CPI) from December 2005 to July 2008.

The 2013 increase is based on the data from the National Statistics Office (NSO) which indicates a growth of 18.3 percent and 16.71 percent on construction materials wholesale price index and consumer price index, respectively, for the five-year period between December 2008 and January 2013.

This means for the private housing sector more opportunities to serve the low-income market by adjusting the coverage of housing packages accorded with all incentives and privileges accorded by government without having to sacrifice the quality of their projects.

Providing mass housing the impetus it deserves will lead to more activities in real estate and thereby boost construction activities. Any disincentive to housing, therefore, negates these positive opportunities and works to the disadvantage of all stakeholders.

We commend HUDCC for heeding the call of the industry resulting to this much-awaited raise in socialized housing price ceilings. CREBA echoes the voice of private real estate developers who are its members that the production and delivery of socialized housing units by the private sector will primarily depend on a responsive government acting as catalyst in a business-friendly environment.