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Developers say MRBs to ease 4M backlog

Published on Friday, 23 November 2012 00:00
Written by IRMA ISIP

Malaya Business News Online - Philippine Business News | Online News Philippines

Low-end subdivision developers affiliated with the Organization of Socialized Housing Developers of the Philippines (OSHDP) are suggesting that medium-rise buildings are the most cost-effective way of addressing the 4 million housing backlog in the country,

Jefferson S. Bongat, OSHDP national president, said that in-city housing, such as medium-rise buildings (MRBs) for multi-family dwellings, can serve larger number instead of  for example,  rowhouses.

Bongat, however  said that , private developers need tax breaks from government to make developments like these to be viable, similar to those given to them for horizontal development.

Bongat said said the MRBs are ideal for low-income individuals, particularly renters, who need to be in their place of work.

Under the scheme, one MRB can be built within a 2,000-square meter area. It would be 5 storeys high with just 125 units to keep the density low. Bigger lots could accommodate multiple buildings. The minimum area per unit is 20 sqm.

Development cost could go as low as P38,000 to P40,000 per square meter which is about the same price for a house and lot package in Cavite.  The monthly amortization would be also the same at about P5,900.

Small pocket developments for MRBs can still be accommodated in Pasig, Cainta and certain parts of Quezon City, Bonggat said.

Once subsidies are in place, a developer can roll out one MRB in 8 months, he explained.  Bongat said the proposal was presented to the Housing and Urban Development Coordinating Council, chaired by housing czar Vice President Jejomar Binay.

Bongat said MRBs also maximize the beneficial use of residential lands in cities, which continue to become scarce and costlier, Bongat said.

He added that  MRBs will keep workers near their families and their place of work or livelihood.

“In the process, it reduces transportation costs and travel stress, by cutting commute time, which workers can put to more productive and gainful use,” Bongat said.

OSHDP’s recent studies reveal that MRB residential units can be built by private developers at the estimated cost of  P840,000 per unit in National Capital Region; Metro Cebu and Metro Davao, give the high cost of city lands.

In other highly-urbanized cities, MRB units can be put up at an estimated P750,000 per unit.

These are designed to be acquired by city workers who are formally-employed and with fixed incomes.

Their savings from reduced transport costs and less commute time could augment their amortization of these MRB units, according to Bongat.

Also based on their recent study, the housing loan package for socialized housing of P400,000 last set in December 2008, may need to be adjusted to P450,000 to reflect the movements in price of land and construction.

These units are located in low-density socialized housing projects in the suburbs of Metro Manila and of regional cities.

These would remain generally affordable given the recent reduction by the Home Development Mutual Fund (Pag-IBIG Fund) of housing loan rates and the longer repayment period of 30 years, as well as the participation of private banks in housing activities.

These housing solutions also will enable the greater participation of private developers, in compliance with the balanced housing development requirements under the Urban Development and Housing Act of 1992 (R.A. 7279), OSHDP said.

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