THE review of the price ceilings for various housing projects in the country may be completed in the last quarter of the year, according to the Department of Human Settlements and Urban Development (DHSUD).
DHSUD Secretary Eduardo D. Del Rosario told the BusinessMirror the review is being undertaken to respond to the clamor from developers and the need to ensure homebuyers can afford these units.
Del Rosario said the review will take into consideration the cost of materials index and the current income of homebuyers to ensure the viability of housing developers and affordability of the units for homebuyers.
“This will impact on the affordability of socialized housing units vis-à-vis the viability of housing developers to continue production, optimizing financial benefits in terms of tax exemption and homebuyers equity for economic housing, etc.,” Del Rosario told the BusinessMirror last Sunday.
Price ceilings
BASED on a public social media post on Sunday, DHSUD said the price ceiling set for economic housing projects is P1.7 million. This covers a minimum floor area of 22 square meters.
The types of housing such as row houses have a minimum lot area of 28 square meters (sqm) with duplex or single attached at 48 sqm and single-detached homes at 72 sqm.
For socialized condominium projects in Metro Manila and other predominantly urban areas, a 22-sqm unit has a ceiling price of P700,000 while a 24-sqm unit will fetch for P750,000.
In other areas, these socialized condominium projects have a price ceiling of P600,000 for 22-sqm units and P650,000 for 24-sqm units.
For socialized subdivision projects, the price ceiling are: P480,000 for a 24-sqm unit or 22-sqm with loft; P530,000 for a 24-sqm with loft or 28 sqm; and, P580,000 for a 28-sqm with loft or 32 sqm or a 2-storey, 16 sqm/floor unit.
“These are the current prices since 2018 for socialized housing; horizontal and vertical. For economic [housing projects], it has been the ceiling I think since 2014,” del Rosario said.
“All these are under review in view of the clamor of housing developers. So to determine the most appropriate ceiling, we have to consider the current cost of production and income capacity of homebuyers,” he emphasized.
Construction materials
BASED on the Construction Materials Wholesale Price Index (CMWPI) in the National Capital Region (NCR), Philippine Statistics Authority (PSA) reported construction materials averaged 2.2 percent in June 2021, higher than the 1.2 percent recorded in June 2020.
This brought the year to date wholesale price increase of these materials to average 2 percent this year. The highest rate this year was recorded in April at 2.4 percent.
The PSA data showed the CMPWI was at or even below 1 percent between August and December 2020. The lowest rate recorded during that period was in September at only 0.5 percent.
In terms of Construction Materials Retail Price Index (CMRPI) in NCR, the PSA reported that prices of these commodities increased 1.2 percent in June and in the first semester of the year. This is the same rate recorded in June 2020.
2021 CPI
MEANWHILE, based on the 2012-based Consumer Price Index (CPI), the PSA said rental for housing accounts for 12.88 percent of inflation. This is lower at 4.15 percent in NCR while the percentage is higher at 8.73 percent in Areas Outside NCR.
For the CPI of the bottom 30 percent of the population, actual rentals for housing has a weight of 7.9 percent in the index.
Based on the PSA’s 2020 Census of Population Housing, house rent/rental value is considered the second-largest family expenditure with a share of 12.2 percent.
For the poorest Filipinos, this is the third-largest expenditure at 8.1 percent of their budget while families in the upper 70 percent income group spend more on house rent/rental at 12.9 percent.