Constraints such as the lack of livelihood opportunities and administrative difficulties prevent the poor from owning residential houses, according to documents obtained by the BusinessMirror.
In a technical report prepared by the previous administration, the Department of Human Settlements and Urban Development (DHSUD) said it was only able to provide direct assistance to less than 20 percent of what is needed annually.
This, the agency said, is compounding the challenges faced by poor Filipinos in accessing affordable homes. The DHSUD added that while microfinance is available, these are often “uncollateralized, short-term” and carry high interest rates.
“The physical and administrative difficulties encountered by the urban poor in accessing credit for housing and livelihood opportunities often constrain them from achieving their housing goals,” the report stated.
The report added that between 2011 and 2015, the DHSUD, through its Key Shelter Agencies (KSAs), provided direct housing assistance to 883,222 households.
This translates to a total of 196,271 households per year, less than 20 percent of the estimated average annual housing need, which is pegged at 926,077 households.
“Overall, the need for housing units is estimated to reach over 6 million by 2022. This figure increases to a projected 22 million by 2040. Addressing this deficit requires innovative housing strategies, given the growing urban population and dwindling urban land,” the report pointed out.
The ability of the government to provide housing assistance is also constrained by the budget granted to DHSUD and its KSAs.
The total housing need of 6 million up to 2030 requires a total budget of P2.7 trillion or an annual budget of P180 billion for 15 years.
The report stated that if the housing sector were allocated 5 percent of the total annual budget similar to other countries that would translate to P135 billion annually.
This amount, the DHSUD said, would be adequate to cover 100,000 units under the National Informal Settlement Upgrading Strategy and an additional of 300,000 units annually for qualified housing beneficiaries.
However, in 2021, the budget allocation for housing was only P4.98 billion or 36 percent lower than the P7.82 billion budget in 2020.
“This is not sufficient to cover the annual budget requirement for ISFs [informal settler families] alone, estimated at P45 billion for the 100,000 ISF units as committed in the National Informal Settlement Upgrading Strategy,” the report stated.
“Beyond this, ISFs, low-income and poor households are also unable to shoulder the cost of housing, or access the formal housing system, given the lack of income and availability of financing options,” it added.
In 2020, the newly formed DHSUD estimated that between 2017 and 2022, the housing backlog is at 6.57 million.
This number includes the 1.44 million accumulated need among ISFs and 5.13-million future and/or recurrent need from the formal sector as well as those who need to repair or replace housing units.
Such a figure, however, is lower than the projection in the 2017-2022 Philippine Development Plan, which estimates that the total housing need by 2022 would reach 6.8 million.
BusinessMirror wrote a two-part story on housing and the challenges of owning a home. Part 1: https://businessmirror.com.ph/2020/07/09/pandemic-highlights-phl-property-problems-for-poor-pinoys/ and Part 2: https://businessmirror.com.ph/2020/07/16/pandemic-highlights-phl-property-problems-for-poor-pinoys-2/