When housing supply doesn’t solve the housing problem
The Philippine housing backlog is estimated to reach 3.7 million units between 2022 and 2028, according to the Philippine Statistics Authority (PSA).
Meanwhile, housing production from 2022 to the end of 2025 totaled only about 477,000 units, based on statements from the Department of Human Settlements and Urban Development (DHSUD).
In other words, by the end of last year, only 13 percent of the backlog had been addressed, highlighting the need for more housing units.
Ironically, when you look at the Metro Manila condominium market, you see significant unsold inventory, reaching 80,000 units in Q3 2026. The issue is not just about supply but also about whether households can afford these units and sustain the costs that come with them over the long term.
True cost of homeownership
Affordability is usually discussed in terms of selling price, but that is only part of the picture. A household’s ability to afford a home depends on income, financing terms, utility expenses, association dues, transportation costs, furnishing and appliance purchases, and even move-in costs.
A unit may appear affordable at the outset, but if the overall cost of occupying and maintaining it creates significant strain on household finances, it’s no longer truly affordable.
At the end of the day, though, having access to safe, decent, and affordable housing is what matters, whether through ownership or a lease arrangement. A well-located unit near employment centers, schools, and essential services can provide stability and improve quality of life.
Living in a secure and well-managed community lets families focus on their jobs, their children, and their future instead of worrying about their living conditions.
The supply challenge
Strong demand is apparent where most people want to live: near jobs, schools, transportation, and daily necessities. Yet these are the same areas where it’s hardest to deliver homes at attainable price points.
Developers also face higher construction and labor costs, compliance requirements, infrastructure investments, and financing expenses, while developable land in urban centers is scarce.
Together, these make it difficult to produce housing that the majority of buyers can afford.
To be fair, both the government and the private sector have been doing their part.
Financing programs, flexible payment schemes, discounts, extended payment terms, and various housing initiatives have helped support demand and improve access to housing for many households. But the question is whether these measures can sustain demand over the long term.
Accessibility and affordability
Accessibility also plays a significant role in affordability.
A home can have a low purchase price, but if it requires residents to commute several hours each day, the overall cost to the household rises. Transportation expenses, lost time, and reduced convenience are all part of the formula for affordability.
Similarly, the availability of supporting developments such as transport links, schools, healthcare facilities, commercial establishments, and public services can significantly influence the long-term viability of a community.
This is why affordability and sustainability need to be considered together. Housing solutions are most effective when households can not only acquire homes but also sustain the financial obligations that come with them over time.
Beyond shelter
Housing is not only a social concern but also an economic one. When families have homes that match their incomes and needs, the benefits extend beyond shelter.
Workers who spend less time commuting often have more productive hours, more disposable income, and a better quality of life. Stable housing helps families put down roots, supports children’s education, and allows communities to grow and thrive.
Over time, it creates opportunities for households to improve their financial situation and move up the economic ladder.
Industry watchers can continue to debate inventory levels, housing production, market cycles, and short-term movements in the residential sector, but these should not distract us from the bigger issue.
The long-term challenge is affordability and sustainability.
Until more households can access housing that aligns with both their incomes and their needs, the coexistence of a housing backlog and unsold inventory will continue to remind us that the housing problem is not simply about supply—it’s about ensuring that housing is accessible to the families who need it most.
The author is the associate director and head of Research at Leechiu Property Consultants
