Housing crisis — A ticking time bomb

“The toughest disincentive to the homebuilders is the acute scarcity of available real estate for housing."

In the 1800s, when the Philippines had a population of 1.89 million living in traditional “bahay kubo” homes iconic to Philippine culture, housing and shelter shortages were unheard of.

Today with 119.1-million Filipinos, a staggering increase of 6,300 percent, we face a housing crisis with a shortage of 6.5-million homes, projected to rise to 22.0 million by 2040. Behind these numbers lie millions of families enduring substandard living conditions in shelters that can hardly be called home.

Various studies conducted by reputable housing development associations attribute this shortage to rapid population growth, urbanization, a surge in informal settlers, limited availability of land for housing, outdated construction processes, slow permit processes, inadequate financial support to developers, high financial costs, low returns, and a myriad of other unsettling challenges plaguing the housing industry.

The toughest disincentive to the homebuilders is the acute scarcity of available real estate for housing which is a finite supply currently estimated at ₱305 trillion and growing.

The Home Development Mutual Fund, popularly known as Pag-IBIG Fund, was established in 1978 with two mandates: first, to assist in providing affordable decent shelter, and second, to generate savings for its members.

The Fund was given the herculean task of assisting all its members to build a home through socialized housing loans.

Pag-IBIG has performed exceptionally well in reducing the housing backlog since its creation with an impressive record in the past three years of releasing housing loans totaling ₱341 billion to build 297,000 units.

However, the housing gap reported at 6.5-million units as of end 2023 prompted PBBM to order Pag-IBIG to accelerate its program by financing one million houses per year until the end of his term.

But the huge housing backlog even before Pag-IBIG was created and the rapidly expanding population will keep the housing shortage a continuing national concern.

This dire housing situation poses a serious threat to the nation’s security and stability, which can only exacerbate the divide between the underprivileged homeless and the affluent homeowners.

Given this, there is a risk the homeless may turn to ideologies like socialism, viewing Karl Marx’s classless society as more desirable than capitalism.

Neglecting the housing crisis could lead to widespread homelessness, forcing families to live on the streets or in inadequate, overcrowded, and unsafe conditions, accentuating further the social inequality and potentially sparking political disorder and social unrest.

Further, the housing shortage will have broader economic implications, affecting employment, consumer spending, and economic growth.

Some experts in the housing industry propose solutions such as rethinking government’s role in housing finance, delinking housing social assistance from finance markets, and addressing fundamental supply side and urban governance issues.

But with our freewheeling and disharmonious multiparty political system where the economic agenda is subordinate to other less meritorious plans, there is always the bleak prospect the housing crisis will just be overlooked in the halls of power.

Time is of the essence in addressing the housing problem, and while we may not have the luxury of solving it overnight, we need to demonstrate to future generations that beginning today we are earnestly committed to providing decent homes for all of our countrymen.

Source: Daily Tribune

Pag-IBIG Housing Loan Interest Rates Per Fixing Period — A GUIDE

In the Philippines, one of the most popular housing loans is the Pag-IBIG Housing Loan which is offered by the Pag-IBIG Fund to qualified members. It is open for application for members who are below 65 years old and have posted at least 24 monthly contributions with a good account standing.

The Housing Loan offer of the Fund has helped countless Filipinos acquire a residential property for their family. Truth be told that it is a whole lot different to be living in a house that you can call your own – you have control over the rules and management and yours and your family’s safety comes as the top priority.

The creation of the Fund was anchored with the government’s pursuits to help most especially the low-income Filipinos acquire a residential property.

Under its loan offer, it provides its qualified members not only with an option of up to 30 years repayment for low monthly installments but also a wide array of fixing periods that they can choose from. It will determine the interest rate that will be implemented in your loan constantly in a given period.

It is best to know the interest rate that your loan may incur so you can compute how much of the monthly amortization will be deducted from the principal balance. The implementation of the interest is under a diminishing principal balance.

Thus, the lower the principal balance is, the higher the chance that a bigger part of the monthly due will be deducted from your outstanding loan. If you want advanced payments, it must clearly be indicated in your receipt that the payment will be deducted in advance from the principal balance.

Here is a guide on the fixing period and the Pag-IBIG Housing Loan interest rate implemented under each period:

The Pag-IBIG Fund allows a maximum repayment of the loan of up to 30 years, however, the maximum loan term per application should not exceed the difference between 70 and the present age of the principal borrower. Thus, the 30-year repayment is open for those who are 30 years old and below at the time of the loan application.

Source: Philnews

Pag-IBIG Housing Loan Qualifications 2024 for Member Applications

PAG-IBIG HOUSING LOAN QUALIFICATIONS 2024 – Here is a guide for the members of the Fund on the eligibility criteria in applying for a Housing Loan.

Undeniably, in the Philippines, there are entities that have made names because of specific loan offers or services. One of them is the Pag-IBIG Fund which is most popular for its Housing Loan offer that has been a medium for many people to acquire a residential property.

The Pag-IBIG Fund is a state entity that has been in the service of millions of Filipinos since 1978. Its members are individuals who are locally-employed in the private and public sectors in the Philippines, self-employed, and those who applied for a voluntary membership to the Fund.

There are also Filipinos working abroad who manage an active membership to the Fund. The government office has several loan offers but its Housing Loan is the biggest contributor to its popularity.

The Pag-IBIG Fund’s Housing Loan offer was designed to serve several purposes related to residential properties. A member may apply for the loan to finance any of the following:

• Purchase of a fully developed residential lot or adjoining residential lots not exceeding 1,000 square meters

• Purchase of a residential house and lot, townhouse or condominium unit;

1. Pre-owned or brand-new units,

2. A property mortgaged with Pag-IBIG Fund; or

3. Adjoining house and lots / townhouses / row houses / condominium units.

• Construction or completion of a residential unit on a residential lot owned by the borrower or a relative of the borrower

• Home improvement

• Refinancing of an existing housing loan

Who are qualified to apply for the offer? Here are the Pag-IBIG Housing Loan qualifications for member’s eligibility to the offer this 2024:

• active Pag-IBIG Fund member with least 24 months savings

• not more than 65 years old at the date of loan application and is not more than 70 years old at the date of loan maturity

• has legal capacity to acquire and encumber real property

• no Pag-IBIG housing loan foreclosed, cancelled, bought back, or voluntarily surrendered

• If with existing Pag-IBIG Housing account or Short Term Loan (STL), payments must be updated

Under the offer, the Fund accepts a clean Transfer of Certificate of Title (TCT), Original Certificate of Title (OCT), and Condominium Certificate of Title (CCT) as collateral to the loan. There are also Pag-IBIG Housing Loan qualifications in the case of the property. The following are not accepted as collateral:

• Less than 28 sq. m. lot area

• Less than 18 sq. m. condominium floor area

• Properties with road right of way less than 1.5 meters

• Land types classified other than residential use

• Residential buildings must be compliant to the National Building Code, PD958 or BP220 as the case may be

In applying for the loan offer, there are requirements for Pag-IBIG Housing Loan 2024 application. The list of documents needed vary depending on the purpose of the loan application.

Source: Philnews