Housing built on sand
For a while there, the figures rekindled hopes among Filipinos that finally, their long-held dream of having their own home was on the cusp of being reality.
At the launch of the Pambansang Pabahay Para sa Pilipino (4PH) program in September 2022, President Marcos vowed that his administration would build at least 1 million low-cost housing units every year until his term ends in 2028—or a total of 6 million units.
The United Nations Human Settlements Programme has placed the country’s housing backlog at 6.5 million units, with about 3.7 million informal settler families directly impacted by this deficit.
The 4PH program, the flagship national housing initiative of the Marcos administration, sought to end the massive housing gap through affordable financing, partnerships with local government units (LGUs), and streamlined processes to tackle affordability and funding bottlenecks. With the Department of Human Settlements and Urban Development (DHSUD) at the helm, it vowed to provide subsidized housing loans and lower monthly payments for Filipino workers who would be housed in vertical (condominium type) developments, later expanded to include horizontal housing.
Three years later, the dream has shattered, like a house built on sand, a casualty of what turned out to be a politician’s stock-in-trade: overblown promises.
Lukewarm participation
Late last month, during the bicameral committee’s budget deliberations, the 4PH allocation was slashed from P700 million to just P35 million, on the request of the DHSUD itself which cited its inability to use its funds for the past two years.
Indeed, former DHSUD Secretary Jose Rizalino “Jerry” Acuzar was replaced this year by his undersecretary, Jose Ramon Aliling, for underperformance. In the last three years, according to Senate finance committee chair Sen. Sherwin Gatchalian, the agency has completed only 438,000 housing projects, and that at its full funding capacity.
So despite its best intentions, why didn’t the 4PH program take off?
For a start, there’s the lukewarm participation of most developers who balk at the massive infusion of capital needed to join the program with no assurance of returns, given the current slump in housing demand. Reports have indicated a 42-month glut or oversupply of condo units because of the ban on Philippine offshore gaming operators, whose staff used to occupy these high-rises.
Even with the government recently increasing the price ceilings for the prospective housing units—P844,440 and P950,000 for horizontal or stand-alone homes, and P1.28 million and P1.8 million for vertical developments, depending on square meter size—the prices are way below the construction costs and current market prices to get developers sufficiently interested.
Capacity to pay
The subsidy offered on reduced interest rates on housing loans seems unrealistic as well, with the beneficiaries’ capacity to pay highly improbable. While Pag-Ibig, the government agency providing savings, housing, and loan programs for Filipino workers, might be willing to trim interest rates to 3 percent from its usual 10 percent for member-borrowers, that still amounts to a hefty monthly interest on top of payment for principal, monthly dues for condo buyers, maintenance costs, and utilities.
As renowned architect and urban planner Nathaniel von Einsiedel has pointed out, the problems that the 4PH program faces are affordability and the low income of its projected beneficiaries.
A study by the Philippine Institute for Development Studies published last year bears this out, as it noted that wages have failed to keep up with rising housing costs. Hence the persistent informal settlements problem, homelessness, and congestion in urban centers.
“These studies have shown that the government’s attempts to address housing issues by imposing below-market price ceilings and providing interest rate subsidies have proven ineffective,” PIDS said.
Crippling poverty
So while support from other government agencies in the form of low-interest housing loans and other commendable initiatives are in place, what needs to be addressed is the crippling poverty that has confined most Filipino wage earners in cramped squatter colonies and makeshift homes.
More realistic and updated wage standards must be looked into, with an eye to keeping small companies afloat despite the added costs of providing a living wage for their workers. Regular job fairs and job creation by LGUs and the national government must be explored as well so that Filipinos can continue to sustain their households, while setting aside some savings for housing.
Just as crucial is to spread the jobs and development to rural and suburban areas to stem the unrelenting migration to cities and urbanized communities, where homelessness for the jobless becomes inevitable.
Unless government checks out other modalities on mass housing to make it more affordable while making sure that wages keep up with rising costs, the ordinary Filipino’s dream of owning a home might just collapse like a house of cards.
