SOCIALIZED HOUSING TO FEEL EFFECTS

The Organization of Socialized and Economic Housing Developers of the Philippines ask the government to retain value-added tax exemption for this sector under the second tax reform package, citing housing as a basic need

It’s not only the manufacturing and outsourcing industries that are lobbying for the retention of incentives under the Tax Reform for Acceleration and Inclusion 2 package.

The Organization of Socialized and Economic Housing Developers of the Philippines (OSHDP) warn that modernizing the incentives may negatively impact the production of socialized and low-cost housing in the country, said OSHDP president Marcelino Mendoza.

“Essentially, OSHDP is not in favor of provisions of proposed bills that will remove incentives to socialized and low cost housing,” he said.

The OSHDP official noted that this underproducing segment of real estate should be protected to address the hous- ing gap.

“This sector is producing houses that should be the responsibility of the government, and not being profitable, government support and assistance is necessary,” said Mendoza.

The organization seeks to keep the VAT exemption on low-cost, economic, and socialized housing in the proposed Train package, citing housing as a basic need.

“We are fighting to retain the incentives because this will affect poor families who want to own houses,” said Mendoza.

OSHDP said that imposing VAT will make houses less affordable. It may also temper demand and slow down housing production and negatively impact other allied industries (See related stories on page A18).

The country’s housing backlog is somewhere between 168,000 and 190,000 units a year. By 2021, the housing need is projected to be around 6.7 million.

Socialized housing in the Philippines, which includes building a house and buying land, costs a maximum of P450,000.

According to OSHDP, developers are shying away from developing houses for this segment for being “unprofitable.” The group added that slower production in this segment would mean widening the gap in housing needs.

Besides the retention of incentives, OSHDP is also lobbying for a bigger budget for housing to address the backlog.

“The government is really trying to address this big concern, but the budget (for housing) was reduced,” said Mendoza.

“OSHDP advocates helping the government address the housing needs but we need more funding from the government,” he added.

The OSHDP wil hold its national convention in Cebu on Aug. 23 and 24 at the Marco Polo Plaza Hotel.

The group expects 400 delegates from the academe, government agencies, developers, builders, finance institutions and real estate service professionals to attend.

The convention will cover topics on sustainable housing finance, sustainable land management and governance, legislative measures to sustain housing growth, sustainability marketing and sales strategies, sustainable housing solutions and urban sustainability and resilience.

This sector is producing houses that should be the responsibility of the government, and not being profitable, government support and assistance is necessary MARCELINO MENDOZA

OSHDP president