Affordable housing still a dream

With President Marcos ordering an inventory of public lands that could be used for the government’s flagship housing program, the housing units “will become more affordable,” Department of Human Settlements and Urban Development (DHSUD) Secretary Jose Rizalino Acuzar has declared.

Administrative Order No. 21, issued on April 30, created an inter-agency coordinating council tasked to prepare a master list of idle, abandoned, and other government lands that could be used to build housing communities for beneficiaries of the Pambansang Pabahay para sa Pilipino (4PH) program. The various government agencies are asked to identify within 60 days suitable lands in their possession that could be included in the list.

“We are giving our full attention to come up with the master list the soonest so that we can identify the areas suitable for housing and immediately consider it [for the 4PH],” Acuzar said.

Tapping government-owned land as sites for the socialized housing program could be one solution to the main issue that could hamper the project’s success: affordability.

Ambitious target

In a House of Representatives hearing on the DHSUD budget last year, lawmakers had lengthy discussions on the feasibility of the Marcos administration’s ambitious target of building one million housing units a year, or six million for the duration of the President’s term.

Marikina Rep. Stella Quimbo pointed out that the housing program would be very costly for the government, which will be subsidizing the bulk of the interest rates on amortization. For this year, DHSUD had asked for P1.5 billion which will cover just 50,000 housing units. In response to her questions, DHSUD Undersecretary Roberto Juanchito Dispo said it would cost the government P36 billion to cover the interest rate subsidies for one million units. Multiply that by five million more housing units.

Eventually, Dispo said, the housing beneficiaries might have to shoulder the interest rates on expectations that their salaries will improve over time.

But the reality is, Quimbo said, it was “usually hard to collect [fees]” for socialized housing as experienced by local government units (LGUs).

Far-fetched dream

Minimum wage earners cannot even afford the monthly amortization for the housing units, pegged at P3,500 to P4,500, as pointed out by House Deputy Minority Leader Rep. France Castro in the same hearing. She told DHSUD that “it’s a far-fetched dream for the poor to afford P3,500 monthly payments if they are making only P610 a day or the minimum wage. The poor cannot afford your proposal.”

Under the current program, the government through the DHSUD will subsidize 5 percent of the 6 percent proposed interest rate for amortization, with the remaining 1 percent to be paid by the beneficiary. If the beneficiary shoulders the entire 6 percent interest rate, as raised by Dispo, this further makes the housing program more out of reach for many of the intended beneficiaries. Thus, the DHSUD and the different agencies involved in the 4PH program need to further crunch numbers and find ways to make the units truly affordable to the poor.

The Pag-IBIG Fund could be tapped to help ease the pressure of the interest rate on the poor beneficiaries even as it funds the housing loans and 4PH projects. Last week, Pag-IBIG released P101.5 million for the 4PH project in Bocaue, Bulacan, which followed its provision of P550 million for housing projects in other areas in Luzon and Visayas. Pag-IBIG has released nearly P13 billion in revolving credit lines last year.

Program’s sustainability

And yet, despite all these available loans, the projected beneficiaries of the 4PH program still face the dilemma of how to pay their monthly amortization, which Pag-IBIG Fund CEO Marilene C. Acosta has emphasized is vital to ensuring the sustainability of the housing program.

The DHSUD has yet to provide details of how or how much the unit cost and interest rates would go down if the land for the planned housing units were government-owned. But it should also boost the agency’s plan to develop “well-designed and self-sufficient communities” that are equipped with amenities and green spaces, and are near the homeowners’ places of work, schools, and other commercial areas.

The agency has already learned from the lessons of failed housing programs of past administrations, by adopting in-city housing sites that are accessible to the livelihood sources of its beneficiaries.

Still, the present pricing models could benefit from a thorough assessment based on the valuable inputs from lawmakers, the LGUs, and most of all, the workers and poor sectors who are supposed to benefit from this flagship program.

With time ticking on its one-million-a-year target, the DHSUD should come up with more viable terms as it projects to deliver the first 100,000 housing units this year. The success of the 4PH program depends on whether Acuzar’s assurances for “more affordable” housing units won’t be another empty promise.