Rent control extended

 Rental cap law still in effect for two more years

THE Housing and Urban Development Coordinating Council extended the soon-to-expire rent control law for two more years, Vice President Jejomar C. Binay said Wednesday.

The cap on rental increases applies to residential units in Metro Manila and other highly urbanized cities whose monthly rent does not exceed P10,000, and those in other areas with rental rates up to P5,000 a month, he said.

Under the Rent Control Act of 2009, which will expire on Dec. 31, rent on these units will not be increased by more than 7 percent annually as long as the units are occupied by the same lessees.

“We want to help renting families have breathing room given the recent increases in power rates and the natural calamities we experienced,” said Binay, who is chairman of the HUDCC. The law grants HUDCC the authority to extend rent control, if warranted.

HUDCC recommended a two-year extension to last until December 2015 based on the results of a study conducted by the Statistical Research and Training Center (SRTC), an attached agency of the National Economic and Development Authority.

The study showed that about 1.5 million households, or 7.2 percent of the total 21.5 million households nationwide, are renters. Of this, 97 percent pay P10,000 and below monthly, he said.

In 2012, the monthly average family income of renters in the country was P23,968, with P27,246 for Metro Manila and P20,794 for other areas. Families in Metro Manila spend about 12.4 percent of their income for house rent.

The findings have yet to be validated, however, because the final figures on housing from the 2010 Census of Population and Housing are still not available.

The study also needs additional data such as the Wholesale Price Index for Construction Materials, Real Estate Price Index

and Depreciation Costs, among others, to provide a comprehensive analysis on rental regulation.

Senators, who learned of the HUDCC’s decision to extend the law during a Senate housing committee hearing on Wednesday, hailed the move because it hastened the extension of the law (Republic Act 9653) without having to go through the lengthy legislative process.

Senate President Ralph Recto said the HUDCC resolution was a quick way to extend the Rent Control Act and Congress could simply pass a resolution expressing congressional concurrence with the HUDCC’s action.

The HUDCC had earlier asked Congress to amend the law and extend rent control at status quo rates up to December 2015 based on the initial results of a study conducted by the Statistical Research and Training Center, an attached agency of the National Economic and Development Authority.

Recto last month filed a resolution extending the program’s life to 2017 in response to the request, but waiting for its passage may cause more problems because of the expiration of the law on Dec. 31.

“There is no harm in redundancy,” Recto said as he expressed support for HUDCC’s request while insisting “that the extension should not be contingent upon the passage of the requested congressional resolution.”

He said rent control would not dampen investments needed to reduce the housing backlog, since units leased for more than P10,000 a month in Metro Manila and P5,000 outside it are not covered.

“We are only protecting the middle class and the poor and not some rich guy who has the money to rent a Forbes Park mansion,” Recto said.



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