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House committee OK’s rent control bill

Vol. XXII, No. 147 [ BusinessWorld Online ]

Thursday, February 26, 2009 | MANILA, PHILIPPINES


THE HOUSE of Representatives committee on housing and urban development has approved a measure that will protect tenants for three more years from unreasonable rent increases, following the lapse of the law concerned.

The unnumbered substitute bill to House Bill (HB) No. 5703, authored by Speaker Prospero C. Nograles of Davao (1st district) and committee chairman Rep. Rodolfo G. Valencia of Oriental Mindoro (1st district), and HB 5849 authored by party-list Reps. Teodoro A. Casiño and Saturnino C. Ocampo (Bayan Muna); Rafael V. Mariano (Anakpawis); and Liza L. Maza and Luzviminda C. Ilagan (Gabriela), sets a lower limit to rent increases.

Republic Act 9341, or the "Rent Control Act of 2005" which set a 10% annual limit to such increase, expired last Dec. 30.

The substitute bill sets the annual cap on rent increases at a lower 4% for units being rented out for not more than P10,000 per month in Metro Manila and other highly urbanized cities, and not more than P5,000 in other parts of the country.

It also sets a one-year moratorium on rent increases upon effectivity of the proposed law.

On the fourth year, the Housing and Urban Development Coordinating Council (HUDCC) will assume the authority to extend this limit on rental increases per year, if warranted, to determine the residential units covered by such limit, and to adjust the allowable limit which will not be more than the average monthly inflation rate on rentals of the immediately preceding year, as determined by the National Statistics Office.

Also, the HUDCC is mandated to conduct every five years from the proposed law’s effectivity a review of its implementation and a study on rental regulation, and submit to Congress its recommendation on whether a continuing regulation is still necessary or deregulation is already warranted.

"In the event that the HUDCC feels there is a need for deregulation, they are [sic] tasked to craft within two years a guideline for safety measures to protect the renters. After such period, the industry can already be deregulated," committee chairman Valencia said in yesterday’s committee meeting on the bill.

The bill also prohibits landlords from collecting more than one-month advance rent and two months deposit, amounts which will be used to settle unpaid utility bills or repair any damage to the unit.

Senate Majority Leader Juan Miguel F. Zubiri had filed a counterpart bill in his chamber, Senate Bill No. 2884, which aims to make the limit to annual rent increases permanent. That bill is still pending at the Senate committee on urban planning, housing and resettlement that is led by Senator Rodolfo G. Biazon. — Jhoanna Frances S. Valdez

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