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Rent control bill hurdles 2nd reading

Vol. XXII, No. 181 [ BusinessWorld Online ]

Friday, April 17, 2009 | MANILA, PHILIPPINES


THE HOUSE of Representatives approved on second reading last Wednesday night a bill aimed at protecting housing tenants from unreasonable rent increases for at least four years from the date it becomes law.

House Bill (HB) 6098, or the proposed Rent Control Act of 2009, is a substitute bill to HB 5703 authored by House Speaker Prospero C. Nograles of Davao City (1st District), HB 5849 authored by party-list Reps. Teodoro A. CasiƱo and Saturnino C. Ocampo (Bayan Muna), Rafael V. Mariano (Anakpawis), as well as Liza L. Maza and Luzviminda C. Ilagan (Gabriela); and HB 5909 authored by Bohol Rep. Edgar M. Chatto (1st District) and Leyte Rep. Eufrocino M. Codilla Sr. (4th District) which all set a lower limit on rent increases.

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

Under the bill, the annual cap on rent increases is set at 4% for residential units 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 areas.

It also states that rent on any residential unit covered will not be raised within one year date of its effectivity. After the one-year moratorium and the three-year period during which the 4% cap will be in effect, the Housing and Urban Development Coordinating Council (HUDCC) will be given authority to determine residential units covered, as well as adjust the allowable limit on rental increases per year which should not be more than the average monthly inflation rate of rentals of the preceding year.

The HUDCC is likewise mandated to review rental regulation every five years from the effectivity of the law and submit to Congress a recommendation on whether the industry must continue regulation or be deregulated. Deregulation should have a two-year transition.

Mr. Nograles said that he would like the bill to become a law before the second regular session closes this June. "The House will pass it. The Senate should also do it before June 6," he said in mobile "text" message yesterday.

The Senate version of the measure which aims to make a 10% limit to annual rent increases permanent is still pending at the Senate committee on urban planning, housing and resettlement. — Louella D. Desiderio

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