By Charles E. Buban
Philippine Daily Inquirer
WE MAY NOT realize it, but improving the standard of living here in the Philippines may depend on one sector that as of now receives meager support from both the government and the private sector.
“Indeed, socialized housing is one sector that seldom gets attention despite the fact that its revitalization may alleviate the condition of around 30 million Filipinos who are currently living near or below the poverty line,” notes Linda Tan, president of the Organization of Socialized Housing Developers of the Philippines.
Tan admits that even for the country’s top property developers, little is devoted to socialized housing considering the many challenges involved, seeing little return on their investment is just one of them.
“This is why, in 1995, small property developers and those with substantial investment in socialized and low-cost housing projects formed the OSHDP. Aside from strengthening our collective voice, our organization believes someone must take up the cudgels for the sector otherwise a third of Filipinos would forever remain renting their homes or living as squatters and in subhuman conditions,” says Jefferson Bongat, OSHDP vice president.
According to Bongat for this year, OSHDP has several issues it would like to tackle with the housing authorities and lending institutions:
1 More sources of funds for those availing socialized housing units. “Currently, the only reliable source of loan is the state-administered Home Development Mutual Fund, also known as Pag-Ibig Fund. In fact, it offers the lowest interest rates in the market: 6 percent for loans up to P400,000 and 7 percent for loans above P400,000 to P750,000,” says Sonny Ducay, OSHDP director and PRO.
This means borrowers in the P400,000 housing loan package will only have to shoulder a monthly amortization, for 30 years, of P2,398.
According to Ducay, this monthly payment may already be manageable for a family earning about P7,400 a month.
“It was also great that Pag-Ibig Fund has increased its total budget for its housing loan programs in 2009 to P84.5 billion in order to cater to the strong demand for low-cost housing. While we expect a similar increase in allocation this year, we also would like banks to formulate a similar package that would allow our borrowers to avail a more accommodating housing loan package. These families also deserve to be trusted,” Ducay says.
2 Exemption from “cash advance” that utility providers ask developers of socialized housing projects. One of the major challenges a developer has to deal with these days is the need to shell out additional money to initially shoulder the cost of installing the needed facilities before service could be provided. For example, Meralco would require “cash advance” for the posts, cables and transformers before electricity will be provided.
The same goes with water providers who require a similar arrangement before water could start to flow into the houses.
3 Price stability of building materials. Ducay says the continuously rising price of raw materials—cement, steel, etc.—affect property developers, big or small.
“But the impact is much more pronounced in small developers whose budget is just enough for the project,” Tan says.
To remedy this, OSHDP is now talking to its members for the possibility of collating their requirements for the year so OSHDP could purchase materials in bulk to receive discounts.
4 Providing incentive for materials suppliers including hardware. OSHDP believes socialized housing projects should be regarded differently.
According to Bongat, the group will formulate a proposal to the Board of Investments and the Department of Finance that would provide a reward system like tax incentives to suppliers who would give much lower or discounted price of their products.
5 Using solar-powered street lights. Bongat reports that OSHDP has approached a China-based firm specializing in inexpensive solar-powered products including solar street lights.
“It’s not only just love of the environment. If we could put up solar-powered street lights on our socialized housing projects, then the poor families that will live there will have less bill to worry about. In fact, we could eventually build a self sustaining community that will rely less on the power grid,” Bongat says.
6 Centralizing land allocation for housing development. While there are advantages of assigning the job of identification and allocation of land for housing development in the hands of local government units, OSHDP believes that not all local zoning officers are knowledgeable enough to perform their mandate.
“It’s a highly technical task that if you are not qualified, there is a huge chance of ruining your community’s zoning. It’s no wonder that we have members who complain about being given a property that is beside a cemetery, which is of course, not very attractive if you are selling your project to a prospective homebuyer,” Ducay explains.
He reports that together with other organizations involved in the housing sector, OSHDP has been pushing for a more streamlined, consolidated and unified activity.
“This will result in less number but more qualified people to deal with not to mention effective and efficient delivery of service,” Ducay says.
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