With the increase in the price ceiling on economic housing from P1.7 million to P2.5 million, the Subdivision and Housing Developers Association (SHDA) is hopeful similar adjustments will be done on socialized housing
George Siy, SHDA chairman, said the group and other housing organizations have been meeting and working with the Department of Human Settlements and Urban Development ( DHSUD) and the National Economic and Development Authority in the determination of the adjustments in the price ceiling on socialized housing after the adjustments were made on economic housing.
Siy said the adjustment should take into consideration increases in the last four years in costs of inputs, as well as income and affordability of the population, especially those that belong to the lower 30 percent of the strata.
The ceiling on socialized housing is currently at P450,000.
Siy said due to price controls, much of the production in socialized level has been unprofitable, discouraging production.
SHDA believes increasing the price ceiling will attract more developers to produce units under economic and socialized housing segments, an essential strategy that will help address the housing backlog in the Philippines.
Backlog is forecast to reach 6.5 million by 2030 and if neglected, is expected to hit over 22 million by 2040, SHDA said.
To close the gap, the industry needs to greatly increase production beyond the approximate 250,000 houses a year being achieved today, it added.
“The price ceiling adjustment, due some years ago, is needed to encourage housing production for our countrymen,” he said.
DHSUD issued on June 10 Department Order 2022-03 implementing the adjustment on economic housing. This will apply to new projects to be launched
For projects with existing licenses to sell, the new price ceiling will be applied to unsold and yet unconstructed economic housing units only.
Total annual housing production in the country averages some 250,000 housing units, mostly produced by private housing developers, with approximately 65 percent in the economic housing bracket.
