Pag-IBIG Deputy CEO Urges Developers to Lower Prices to Solve Housing Problem

Developers Challenged to Reduce Home Prices to Address Market Gap in PH

In the Philippines, there’s a seeming gap in the real estate market as many families stuck at renting and not being able to afford the house they want. Recently, Pag-IBIG Deputy Chief Executive Officer mentioned that affordable financing is not enough to solve the housing problem in the country, therefore urging developers to lower selling prices to help Filipinos acquire decent homes. Will the government and developers ever meet halfway so Filipino families can finally buy their dream home?

Affordable Financing, Lower Home Prices

With affordable financing options and reduced selling prices, it’s possible to address the housing problem for many Filipinos. But is this doable? Can developers really bring down their selling prices of units in condominium buildings, house-and-lot developments, and master-planned townships? Alex Aguilar, the Deputy Chief Executive Office of Pag-IBIG, explained how affordable financing cannot solely bridge the apparent gap in the market.
If only developers can lower their prices, there’s a chance to meet halfway. However, it would be a long process before Filipinos can even enjoy low-cost homes amid inflation. Pag-IBIG is currently capable of providing funding for middle segments, according to Aguilar. At the same time, they are expecting developers in the Philippines to reduce their costs to alleviate the problem in the housing sector.

​Are Developers Up for the Challenge?

Developers currently offer 27-square meter units for PHP 1.8 million, which is still unaffordable for many Filipinos. The call for developers to cut home prices is to help young families start a life with Pag-IBIG financing. The promotional interest is 4.5% for low-cost homes and 3% for socialized housing. The government aims to provide affordable homeownership and it’s shaping the current prices of homes and condo units from big developers.
Here are the developer cut targets and price ceilings to help Filipino buyers get their own home:

• Condo developers are targeting price cuts down to PHP 1.8 million for 27-square meter units.
      
  
• For house-and-lot developments, price ceiling is at PHP 950,000 for 27-square meter units with 3% Pag-IBIG rates.
      
  
• Low-cost housing price caps are up to PHP 2.5 million with 4.5% promotional rate from Pag-IBIG home loan.
  

Pag-IBIG heavily cut down their interest rates to back these developer cuts and make units much more affordable to buyers.

Final Thoughts

Affordable housing is a dream for many Filipinos, and the government support helps achieve it. With lower-interest Pag-IBIG financing options for buyers, it is expected to provide housing for more families and solve the gap in the future. You may visit REALS.PH for our exclusive listings of properties for sale in Baguio City as well as other low-cost homes that you can acquire through government financing services. Feel free to contact us if you have questions regarding the units so our real estate agents can properly guide you in making smart choices.