Subdivision association seeking to increase price threshold for affordable housing units
THE Subdivision and Housing Developers Association (SHDA) is asking the Board of Investments (BoI) to declare more expensive housing units as eligible for incentives, pressing to raise the threshold for homes classified as low-cost housing to P4.2 million to P4.4 million.
Leonardo B. Dayao, Jr., SHDA national president, said at a briefing in Pasay City last week that the BoI has been receptive to the group’s proposal to review the price threshold for affordable housing.
“Right now, the price ceiling for incentives for housing is at P2 million, but we are proposing a much higher price ceiling at around P4.2 [million] to P4.4 million, driven by data,” Mr. Dayao said.
“The markets have shifted. (Their intent was to) incentivize affordable housing. At that time, affordable housing was capped at P1.7 million. But just recently, the affordable housing ceiling was also increased to P2.5 million. There needs to be a review. We are also proposing to conduct a review every three years for the housing price ceiling,” he added.
Mr. Dayao said the SHDA is also proposing to extend the period covered by incentives because project proponents typically do not recognize sales in the first 12 to 18 months.
“We are also proposing the extension of the incentive period from four years to as much as six years. We are praying that the BoI will grant that. So, let’s wait and see,” Mr. Dayao said.
“During a four-year incentives period, essentially the first 12 to 18 months, you don’t get any sales. You don’t get any recognized sales because you’re still doing your land development, you’re still building your houses…” he added.
Incentives for mass housing are considered part of Tier 1 of the 2022 Strategic Investment Priority Plan (SIPP). Some of the incentives offered under the SIPP, depending on the tier, as provided by Republic Act No. 11534 or the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act, include income tax holidays, enhanced deductions, and lower corporate income tax rates.
Mr. Dayao said the Marcos administration’s goal of building one million housing units annually until 2028 is a “very difficult target.”
“One million (units) is very ambitious considering that the past two years, we’ve only been able to do 2,000 (units) per annum. And out of that 2,000, SHDA developers are responsible for 80%,” Mr. Dayao said.
“Within our membership, we do have the biggest developers in the country, and we are really excited and really like to participate in nation building,” he added.
SHDA, established in 1970, is the largest industry group for housing and urban development. The group has 350 members across eight regional chapters. — Revin Mikhael D. Ochave