TECHNOLOGICAL INSTITUTE OF THE PHILIPPINES

938 Aurora Blvd. Cubao, QuezonCity, 1109 Metro Manila

TERM PAPER

AR 551 – HOUSING

SUBMITTED BY:
COMEDERO, RACHELLE LUZ M.
DAYAP, AUBREY VALERIE G.
EGRUBAY, MIKAELA PAOLA A.

SUBMITTED TO:
AR. CHRIS JEHRAM M. MORALLOS

DECEMECER 12, 2023

 Understanding and Addressing the Persistent Housing Backlog in the Philippines

Housing is the construction and designated use of houses or buildings, either alone or as a group,
for the purpose of sheltering. Socialized Housing on the other hand refers to housing programs
and projects that only the government or the private sector undertakes for the benefit of the low-
income and homeless. These projects and houses include the development of sites and services,
long-term financing, cooperative interest payment terms, and other benefits in accordance with
RA 7279. Due to the growing population of Filipino
Citizens and the current economic status of the Philippines,
many Filipino families and citizens were currently
homeless or living in a poor conditioned environment.
Based on Philippine Statistics Authority data, 47 percent
of households have low income and 20 percent are
economically vulnerable. According to the Department of Human Settlements and Urban
Development (DHSUD), the housing backlog is
estimated at 6.5 million homes that could reach the 10-
million mark in 2028, or approximately 10.9 million by
the end of the current administration. In an article written
by the Philippine Institute of Development Studies
(PIDS) (2022), From 2021 to June 2022, DHSUD
produced 294,142 housing units, while the National
Housing Authority provided housing assistance to 85,174 families. In an article written by
Business World Online, the housing backlog corresponds to the projections for the year 2030 as
presented by the Board of Investments. Adrian Conoza (2022)
These projections are based on the assumption that the annual
production of housing units would maintain an average of 200,000
units per year from 2012 to 2030. As reported by BusinessWorld in
October, the implementation of “Pambansang Pabahay Para sa
Pilipino” is anticipated to necessitate P1 trillion for realization,
with an estimated cost of P1 million per home, requiring
subsidization. According to the UN (2023), 54% of the 58.93 million population lives in urban
areas as of 2020.
Socialized Housing dates back to 1938, and its roots trace back to
the social justice policy articulated by the Philippine
Commonwealth President Manuel L. Quezon. In July 1938 a big
tract of land was bought not far from Manila by Don. Alejandro
which would be subdivided into small lots to sell to poor people at
a low price that is within their reach. The National Housing
Corporation was created on September 17, 1945. Eventually, on
October 15, 1975, President Ferdinand E. Marcos promulgated
Presidential Decree NO. 757 - Creating the National Housing
Authority as the sole housing agency. Portrait of Don Alejandro
Roces, Sr.

In an article written by Amy Remo and Erika Sauler, there were 1.5 million informal settler
families (ISFs) nationwide, and around 584,000 were in Metro Manila, according to the 2011
survey of the National Housing Authority. In data gathered by HUDCC in 2015 based on shelter
plans of local government units, the number of ISFs increased to 2.2 million since 2010,
According to Former V.P Robredo “From 2011 to 2016, the total housing backlog could reach
5.7 million, a result of accumulated need and future or recurrent need”.

There are multiple Housing Programs by the government. Over the last decade, the Philippines
has seen numerous natural disasters that have destroyed numerous homes and buildings leaving
the Filipino people with no place to live. The Housing Assistance Program for calamity victims
(HAPCV), is a program for families that were affected by calamities, such as Typhoons:
Typhoon Yolanda (2013) in the Visayas Region, Typhoon Nina (2016) in region 5, Typhoon
Odette (2021) that affected multiple regions like region 13, Region 10, Region 8, Region 7,
Region 6, and MIMAROPA. According to an Article written by Inquirer.net, In July 2014, under
the presidential term of President Benigno Aquino III, with damage to infrastructure and other
sectors estimated to cost close to P90 billion, the government in August 2014 proposed the
Yolanda Comprehensive Rehabilitation and Recovery Plan (CRRP), which involves the
implementation of more than 25,000 disaster rehabilitation and recovery-specific projects,
programs, and activities, this includes Housing programs for Filipino Families.

The initiative, launched in 2018 in response to a Supreme Court mandate, directs Government
Agencies and Local Government units to clean, rehabilitate, and preserve Manila Bay, making its
waters suitable for recreation. The mandate extends to tributaries, requiring the removal of
structures encroaching on water bodies, leading to the eviction and relocation of Informal Settler
Families residing within the 3-meter easement of rivers and esteros.

In a data gathered by HLURB, HUDCC and Research and communication states that there are
shortages of about 663,283 and a startling 1,962,077 units of housing in the socialized and
economic divisions, respectively, due to the demand for housing which exceeds the
available supply. With a 462,160 loss, the low-cost segment's situation isn't much better. Here is
a table that shows the number Demands, Supply, and deficit in the of Housing in the Philippines

Market segment Housing demand Housing supply Surplus (Deficit)

Socialized 1,143,048 479,765 (663,283)
Economic 2,503,990 541,913 (1,962,077)
Low-cost 704,406 242,246 (462,160)
Mid-cost 72,592 322,995 250,403
High cost 18,235 242,246 224,011

The housing backlog in the Philippines is a complex issue that has been a persistent problem for
the country for many years. This problem was due to multiple problems concerning the country’s
socioeconomic fabric. According to an article written by Ian Fulgar (2023), The Philippines'
housing situation is defined by a high demand for reasonably priced homes and a constrained
supply of such apartments. This dynamic is a result of a number of factors, including
urbanization, rapid population expansion, and an increasing number of informal settlers who all
work together to boost the housing market. On the other hand, expensive land and building costs,
legislative limitations, and a lack of readily available finance for affordable housing are blamed
for the inadequate supply of affordable housing units. Furthermore, A backlog has developed in a
number of housing categories as a result of this mismatch between supply and demand. The
economic housing sector, which serves households earning between Php 15,000 and Php 30,000
per month, has the largest backlog at 58%. This emphasizes how urgently low-income people
need access to cheap housing options.
The backlog in housing varies by region; the National Capital Region (NCR) and Region IV-A,
for example, have larger backlogs than other places because of their higher population densities
and faster rate of urbanization. In addition, there are more informal settlers in these areas, which
worsens the problems brought on by the housing problem.

The rural to urban migration is one of the reasons for the housing problem in our country. In
hope of having a better life, most Filipinos tend to migrate from rural to urban areas, mainly to
find better jobs or leave disaster-prone regions. This increase in housing demand, in turn, leads to
a rise in land value and higher housing prices, the higher the land value and housing prices, the
higher the number of Filipinos who won’t be able to afford it resulting to the increase of ISFs in
certain areas. In relation to this, Poverty is also one of the causes of Housing Backlogs. The
Annual Poverty Indicator Survey of the government (2004) revealed that four out of every 10
Filipino families do not own their house and lot. Due to the increasing number of families who
can’t afford the market value of a housing unit, the number of families living in dangerous and
illegal areas gradually increases as well.

There are other constraints and issues hampering pro-poor land and housing programs, these
include high transaction costs brought on by vague and confusing land use policies; landowners'
unwillingness to participate in the Community Mortgage Program (CMP); and local government
units' (LGUs') misinterpretation and/or failure to implement the provisions of the Urban
Development and Housing Act (UDHA) and its implementing rules and regulations.
Furthermore, the majority of LGUs lack shelter plans and programs that would enable proactive
planning and results-based targeting of their local shelter problems. This leads to budget non-
appropriation, which in turn causes backlogs in housing and land.

Another major concern is the provision of land and housing to internally displaced persons
(IDPs) due to natural hazards and armed conflicts. There are some 300,000 IDPs in Mindanao
alone. IDPs fleeing disasters or conflict often seek shelter in temporary shelters or informal
settlements, putting additional strain on already limited housing resources. This sudden influx of
displaced individuals creates an immediate need for more housing units, exacerbating the
existing housing backlog. One example of this is the Marawi Siege (2017): This conflict
displaced thousands of families and caused extensive damage to the city of Marawi, leaving a
significant housing gap.
Another major cause of the Housing Backlogs in the Philippines is the aftermath of Natural
Calamities and Infectious Diseases. According to an article written in reliefweb (2009), Some of
the major events that are related to these issues are the Typhoon "PEPENG" which damage
54,373 houses, Tropical Storm "ONDOY" which damage 185,004 houses and, Kathryn Reid
(2013) Typhoon “YOLANDA” which damage 1.1 million houses.

Housing Backlogs have had multiple effects on our society, most especially on those who are
being greatly affected by such situations. Due to the housing backlogs and limited space
available to construct a housing unit, a lot of housing in the Philippines were being placed in a
cluster. This kind of situation can affect the stability of the families that occupy these spaces.
Crowded housing conditions that came from the limited housing space can lead to tension,
conflict and decreased privacy within the family and the neighborhood. Kaya and Erkip (1999)
and Margulis (2003) Environmental psychologists contend that an individual's psychological
well-being is intricately connected to their personal privacy. The intrusion into an individual's or
a community's living space has been identified as a potential trigger for psychological distress.
An individual’s personal space is like a territory, and when that territory is violated, the
individual experiences psychological distress (Brown, Lawrence, & Robinson, 2005; Childress,
2004). Another effect of housing backlog and urbanization in the Philippines were Crime rates.
In the context of the Philippines, the challenges associated with urbanization have given rise to a
range of crimes that represent significant concerns for both the government and civil society.
Among these, street crimes, illegal drug trafficking, robbery and theft, violent crimes against
women and children, and terrorism stand out as prominent issues. In a study by Marife M.
Ballesteros (2010), In the bustling metropolis of Metro Manila, considered the primary city in the
Philippines, a staggering 37% of the population, totaling over 4.0 million Filipinos, resided in
slums as of 2010. This slum population exhibited an annual growth rate of 8%, emphasizing the
persistent nature of the issue. The daily reality for these slum dwellers and informal settlers
involves grappling with another facet of poverty — environmental poverty.

Living conditions in these underserviced areas significantly impact health, livelihoods, and the
social fabric of the community. The effects of urban environmental problems and the looming
threats of climate change are particularly pronounced in slums. Hazardous locations, inadequate
air pollution and solid waste management, weak disaster risk management, and limited
household coping strategies contribute to the heightened vulnerabilities of slum dwellers.

Several studies have argued that trade-offs exist between substandard housing and essential
services such as healthcare and education. The detrimental living environment not only deepens
poverty but also increases the vulnerability of both the impoverished and non-impoverished
individuals residing in slums. Moreover, it perpetuates exclusion from the benefits of economic
growth for the slum population, thereby exacerbating existing socio-economic disparities.
Addressing these challenges requires a comprehensive and integrated approach that considers not
only housing but also healthcare, education, and sustainable urban development to uplift the
living conditions and prospects of those residing in slums.

The housing backlogs also had an effect on the current housing programs of the government.
There are inadequate housing projects that is being produced and offered to Filipino families. In
some news by CNN, a housing project for families that was affected by Typhoon Yolanda is
suffering from the lack of water supply, according to CNN Over 20,000 families in Carles, Iloilo
have no direct access to clean water. This is an example of how some housing projects being
offered to Filipino families can go from bare minimum to below the bare minimum. There are
housing projects in provinces that had no access to either electricity or clean water supply,
sometimes both.

There are different Government initiatives that address the problem regarding the housing
backlogs of the Philippines. The “Pambansang Pabahay Para sa Pilipino Program” (National
Housing for Filipinos) strives to address the pressing need for affordable housing through diverse
approaches such as direct construction, land acquisition, and housing loan assistance. Although it
has made strides in providing housing units to low-income families, the program's scale remains
insufficient to effectively tackle the substantial housing backlog.

The Socialized Housing Finance Corporation (SHFC), a government-owned entity, plays a

pivotal role in offering financing options to empower low-income families to purchase or build
their homes. Despite facilitating homeownership for some, challenges persist due to bureaucratic
processes and funding constraints, limiting access for a broader population.

The National Housing for Filipinos in Need (NHFIN) program concentrates on offering housing
solutions for informal settlers and families in disaster-prone areas. While successful in relocating
thousands of families from vulnerable zones, the ongoing demand for resettlement underscores
the persistent challenges in this domain.

The Community Mortgage Program (CMP) introduces a collaborative approach, allowing groups
of low-income families to collectively apply for housing loans. Despite fostering cooperation, its
impact is constrained, necessitating effective community organization for successful
implementation.

In parallel, the Department of Human Settlements and Urban Development (DHSUD) has
initiated reforms to streamline processes and encourage private sector involvement. These
reforms aim to enhance efficiency and attract investment, though their long-term effectiveness
requires ongoing evaluation. Collectively, these housing initiatives in the Philippines represent
critical steps toward addressing the housing crisis, yet there remains a need for continued
innovation, increased funding, and sustained efforts to bridge the gap between demand and
supply, ensuring that more families can secure affordable and sustainable housing solutions.

Aside from the Government Initiatives, there are initiatives from the private sector as well. Real
estate developers in the Philippines are increasingly directing their efforts toward constructing
affordable housing units and extending various financing options to cater to a broader market
segment. While this surge in supply is a positive step, the challenge of affordability persists for
many low-income families, limiting their access to these housing solutions.

Microfinance institutions play a crucial role by providing small loans to low-income individuals
and families, empowering them to initiate or enhance their housing situations. However, the
amounts offered may not be adequate for substantial housing improvements, posing a limitation
to the effectiveness of these microfinance initiatives.

Non-governmental organizations (NGOs) actively collaborate with communities and government

agencies to offer housing assistance, develop innovative housing models, and advocate for policy
changes. While their contributions are invaluable, the impact of NGOs is often localized, and the
extent of their initiatives can be constrained by funding limitations. Nonetheless, these
organizations play a vital role in experimenting with new approaches and influencing policy
discussions related to affordable housing in the country.

Efforts from both the government and the private sector to mitigate the housing backlog in the
Philippines are commendable, yet the sheer magnitude of the problem necessitates more
expansive and coordinated solutions. Tackling challenges such as funding constraints, limited
available land, and affordability issues requires innovative strategies and sustained commitment
from all stakeholders involved. It is imperative to recognize that addressing the housing backlog
is not a short-term endeavor; instead, it demands a long-term vision and dedication.

The housing backlog issue in the Philippines demands a concerted effort to find sustainable
solutions. A comprehensive strategy that integrates government policy changes, private sector
involvement, technological innovations, and community-led initiatives is essential. The
Philippine government plays a central role in shaping housing policies, and strategic changes can
pave the way for significant improvements. First, incentivizing affordable housing construction
through tax breaks and subsidies can stimulate the private sector's interest in developing low-cost
housing projects. Streamlining the permitting process for such initiatives is equally critical to
reduce construction time and costs. Moreover, implementing progressive land use policies,
including zoning reforms and the identification of underutilized public land, can encourage
higher-density developments in urban areas.

There are certain setbacks in the housing programs that involve the delay of permits and other
paperwork that is required to proceed with the housing unit construction. Delays in the
permitting process can significantly impede the progress of housing projects. By simplifying and
expediting this process, the government ensures that affordable housing is delivered in a timely
manner, addressing the urgency of the housing backlog. Streamlining the permitting process for
affordable housing initiatives reduces bureaucratic hurdles, ultimately decreasing construction
time and costs. This enables faster project completion and quicker availability of housing units.
Another proposal is Implementing progressive land use policies, including zoning reforms and
identifying underutilized public land, encourages higher-density developments in urban areas.
This optimizes land use, promoting efficient use of available space. Higher-density developments
contribute to more sustainable and resilient urban landscapes. By focusing on urban areas, the
government can accommodate a larger population within limited space, reducing urban sprawl
and associated infrastructure challenges.

Collaboration between the government and the private sector is pivotal in accelerating housing
construction. Public-Private Partnerships (PPPs) should be actively promoted, with the
government offering financial incentives such as reduced land costs or tax breaks. Encouraging
innovative financing models, including social impact bonds, can mobilize private sector
resources effectively. Real estate companies can contribute through Corporate Social
Responsibility (CSR), allocating a portion of their profits to affordable housing initiatives and
supporting community development. This might seem like an advantage if thinking from a
political position, but Private sector involvement is crucial for addressing the housing backlog, as
it leverages market-driven mechanisms to meet demand. By providing financial incentives, the
government encourages developers to align their interests with the urgent need for affordable
housing. Incentivizing affordable housing construction through tax breaks and subsidies
encourages private developers to invest in low-cost housing projects. This stimulates economic
activity in the construction sector and increases the overall supply of affordable housing.

Housing programs were constructed in different regions and each area had a diverse community.
community-led initiatives, such as community land trusts, allow for tailored and context-specific
housing solutions. This ensures that the unique cultural, social, and economic aspects of each
community are taken into account in the planning and implementation of housing projects.
Communities are diverse, and a one-size-fits-all approach may not address the nuanced needs of
different populations. By empowering communities to shape their housing solutions,
interventions become more responsive and relevant to local conditions. It is important to
consider the opinions of those who will occupy the units being made in order to further analyze
what the community might need in the future and how the housing units could be considered as a
home to the tenants, not just a place to stay because they had no choice.
The housing backlog in the Philippines is a pressing challenge characterized by a substantial
shortage of affordable housing units to meet the demands of a rapidly growing population. The
government has acknowledged the issue and initiated various housing programs, but progress has
been hindered by bureaucratic hurdles, insufficient funding, and a complex permitting process.
The private sector, while recognizing the market potential, faces challenges in navigating
regulatory constraints and financial viability for affordable housing projects. The historical
context reveals a legacy of insufficient urban planning, population growth outpacing housing
development, and inadequate policies. Causes include rapid urbanization, a lack of sustainable
housing policies, and economic constraints affecting both the government and private sector. To
address this, collaborative efforts between the government and private sector are essential,
involving policy reforms, streamlined permitting processes, financial incentives, and the
exploration of innovative technologies. Additionally, community empowerment through
initiatives like community land trusts and co-housing models is crucial for fostering inclusive,
locally responsive solutions that address the unique needs of diverse communities. As the nation
grapples with these housing challenges, collaborative, multifaceted solutions remain key to
unlocking a more sustainable and inclusive housing future for the Philippines.
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