Housing backlog still a big challenge
The housing backlog in the Philippines cannot be addressed overnight, but serious efforts to address the problem over the long-term period must start sooner than later to make the country’s economic growth inclusive.
The country’s housing backlog is currently estimated at 5.7 million. The figure clearly indicates that over 20 million Filipinos, at an average of five members per family, have no decent homes of their own. The number could rise if disasters like earthquakes and typhoons strike.
It is, thus, no surprise that shanties proliferate in the capital region and other key cities in the country against the backdrop of towering structures and ultra modern shopping malls—an urban blight that reflects the income disparity in the Philippines.
State-run housing institutions must double or even triple their efforts if the government wants to make a dent on the housing backlog problem. Home Development Mutual Fund, more popularly known as the Pag-IBIG Fund, is one lead housing agency that could provide the difference to millions of homeless Filipinos.
As a national savings program that can provide affordable shelter financing for the Filipino worker, Pag-IBIG Fund must exert its role in the economy. 2016 was a good start for the fund when it delivered a record P57.3 billion in housing loan takeouts in 2016—by far the highest in the history of Pag-IBIG Fund and surpassing its target last year by P6.8 billion or 13 percent.
The amount assisted almost 77,000 Pag-IBIG members in the acquisition or construction of their new homes.
Pag-IBIG deputy chief executive officer for home lending operations cluster Acmad Rizaldy Moti, who was appointed by Malacañang as officer-in-charge of the fund effective March 1, 2017, credited the accomplishment to Pag-IBIG branches nationwide
“Pag-IBIG’s home lending operations doubled its efforts last year making the quarterly loan disbursements in 2016 the highest ever for each quarter, resulting in this historic accomplishment of the Fund. As early as November, the Fund already breached for the first time the P50-billion mark in loan takeouts,” he said.
Moti stressed that the number of Pag-IBIG members who received assistance in acquiring homes was more critical to the agency.
“You should see the reaction of Pag-IBIG members whose housing loans were approved. The joy in their faces and their indescribable happiness, these continue to inspire us to do our best and work even harder,” Moti said.
Cabinet Secretary and Pag-IBIG chairman Leoncio Evasco Jr. has prodded Pag-IBIG to innovate and offer housing programs that will give access to decent and affordable housing to every Filipino family.
“We fully support the commitment of Secretary Evasco to provide more housing opportunities to Filipino families, particularly those belonging to the low-income segment,” Moti said.
Pag-IBIG has a yearly average housing unit delivery of 50,000 in the last five years (2011 to 2015). In terms of loan value, the Fund’s annual average during the same period is P36 billion, reinforcing the Fund’s standing as the biggest source of home financing in the country.
Pag-IBIG Fund in 2016 also helped 24,983 low-income workers in realizing their dream of home ownership through Pag-IBIG housing loans, with a combined loan value of P8.5 billion.
Moti said the number of units was 33percent of the Fund’s 76,247 total housing loan portfolio last year, and higher by 25 percent, or about 5,000 units, than the total socialized housing units delivered in 2015.
“Pag-IBIG Fund actively contributes to the efforts of the national government and the housing industry to offer decent and affordable housing to the underserved sector,” Moti said, adding the Pag-IBIG member-borrowers under socialized housing were mostly minimum-wage earners and individuals from low-income groups that include household helpers and public utility vehicle drivers, who do not have access to the housing loan facilities of private financing institutions.
The Housing and Urban Development Coordinating Council set the socialized housing price ceiling at P450,000.
Moti said Pag-IBIG partnership with employers also had become an effective strategy in providing socialized housing to the employees.
The partnership allows employers to offer the housing units at a price lower than the appraised value.
Moti cited the housing project of Dole Philippines and the local governments of Malabon City and San Carlos City in Negros Occidental, where the beneficiaries were able to purchase housing units for just P450,000 against the appraised values of over P650,000.
The Dole Philippines project has 144 duplex housing units, each having a 35 sq.m. unit in a 70 sq.m. lot area complete with partition for two bedrooms.
“This is made possible because our partners usually own the land like in the case of Dole, which also adopted the “sweat equity” concept in house building. In the same manner, LGU-owned properties are utilized for their housing projects and they waive development related fees,” Moti said.
Qualified borrowers, under Pag-IBIG’s Affordable Housing Program for minimum-wage earners, may avail of the subsidized interest rate for housing loans not exceeding P450,000 at a yearly rate of 4.5 percent for the first 10 years of a 30-year loan, with a monthly amortization of around P2,280 only.