Thank you, first of all, for the honor and opportunity to address the Subdivision and Housing Developers Association on its National Developers’ Convention. 
            The magnitude of our work—our mandate and your business—is not alien to you. Your theme, “Housing agenda in a new era of sustained growth,” suggests this. It assumes that our mandate in government is not changing: the need for housing is not diminishing in urgency and volume, while your sector must in the process grow its business. There is no other way. In this task we are engaged in a symbiotic relationship, and I am tempted to quote the poet Auden, who said, “We must love one another or die.”
            Of course the context is different. Auden wrote that on the date that the poem makes its title, “September 1, 1939,” the outbreak of the Second World War. But our war against homelessness continues and again we must regard the magnitude of our task and be able to say with the same urgency, that we must work together or the people lose not just the dream of a roof over their heads but the hope for a better life.
            That, in no uncertain terms, my friends, is the nature of our relationship.
            I promised during the courtesy call of your officers in my office last July that I will be attending this convention. You and I cannot miss this opportunity to listen to each other because obviously I will not be the only one talking in this convention. It is a chance to make and review policy, to make policy initiatives towards a sustainable housing sector.
            As you propose your own housing agenda in this convention, let me, on our part, share with you government’s agenda of reform.
            One of your officers—I think it was Mr. Alunan from Bacolod—mentioned in our meeting the reason developers are so hesitant and apprehensive in doing their part of the partnership.
            He pointed to the perennial lack of funds. But not without the unique characteristic of how it is to lack funds in housing. Developers cannot aggressively build or sell more houses if the Home Development Mutual Fund, or PAG-IBIG, does not have the money for take-out. This is about confidence in the system.
            It has always been said that the first step in solving a problem is to define the problem. I think we are not remiss on that part. So let me deal first on the supposed lack of funds at PAG-IBIG.
            I have just adjusted the target of our housing loans from 75,000 housing units to 150,000 units and will set aside P30 billion in new loanable funds that will be made available to buyers and developers.
            This is ambitious, I know. But I also know that if we must make PAG-IBIG responsive to the growing interests of stakeholders like you, if we must make you true partners in development, we must put in courageous interventions in unprecedented proportions.
            Right now, we are interceding if not intervening to accelerate action in the other groups and sectors of housing. We must deliver more houses to fill the gap between housing stock and housing need, which is about 350,000 each year.
            Organizational reforms in key shelter agencies are underway. In PAG-IBIG, for example, the investments portfolio in non-related housing businesses will significantly be shifted to investments in housing development—your sector.
            My friends, let me give you my word that as HUDCC chairman. I will address your concern for funding.
            Magkakaroon at dadami ang pera para sa mga housing developers na katulad ninyo— basta tama ang paggawa ng bahay at maayos ang inyong mga buyers.
            The concern over the supposed lack of PAG-IBIG funds arises from the seeming disparity in the distribution of loanable funds by region or by developer. Or, by the evidently dysfunctional dispatch of loanable funds, again either by region or by developer. This you saw in the recent controversy of a certain developer who has been perceived as being “favored” over others, and in the process cornering a sizeable amount of the loanable housing funds for his development. To this the said developer admitted as much in the newspapers.
            The implication was, while the other developers in the region were waiting for their take out for almost four to six months, the “favored” developer was getting his in just three to seven days. In volumes, this was equivalent to hundreds per day, from a total fund commitment line especially and inequitably granted totaling P5 billion.
            As you and everybody know, this prejudicial modus operandi deprived other developers in other regions of the much-needed funds while those who abided by the rules had to either wait in line or got bumped off.
            Now, what is the policy implication of this controversy? The basic defect in the concentration of loanable funds to a single developer is the inconsistent application of a Single Borrowers’ Limit (SBL) policy. My predecessors have adopted an SBL for institutional loans or development loans of P3 billion for a single developer borrower.

            On the other hand, the end-buyers loan did not have an SBL limit, with the justification that the borrower under this window is not the developer but the buyers themselves.
            Now, this is incorrect since the buy-back guarantee requirement under this window is a contingent liability of the developer and therefore should be part of a borrower’s limit or restraint. This allowed that same developer in Pampanga to avail himself of a P5 billion end-buyers loan outside of his institutional loan of P3 billion. That same developer, after getting P5 billion end-buyers loan, got an additional approval of P6 billion for a project in Zambales.  Had this P6 billion project been implemented, more havoc would have been wrought. The grant of more end-buyers loans was imprudently tolerated in the absence of a prudent SBL policy.
            As you would rightly insist as partners and stakeholders in housing, this inequitable practice, this policy inconsistency, must stop. This is what we will do to solve the disparity in the allocation of loanable funds:

            •  First, we will come up with an SBL policy that will include in the ceiling computation for a single borrower limit all the loans of developers in all lending windows of pag-ibig, whether it is institutional or end-buyers financing.

            •  Second, we will deploy the loanable funds co-equitably per region on the basis of demand for housing loans and performance of developers.

            •  Third, we will not favor any developer except to affirm those who are able to build integrity into the houses that they deliver, as much input integrity in the buyers that they present.

            Walang palakasan, walang sinuman na bibigyan ng pabor para sa mga housing loans.  Ang malakas lang sa amin ay mga kahalimbawa ng taga-SHDA na gagawa ng maayos na bahay at pasilidad sa subdivision at may tunay at maayos na buyer.
            Regarding processing time to secure take-outs from PAG-IBIG, please know that we are in the process of improving the system.
            Our direction is to lessen the processing time while making sure that enough safeguards are in place. We will take into account the value of the CTS system that you are happy to retain. However, we will introduce additional controls and safeguards on the utilization of mortgage instruments. We will constantly challenge the ability of PAG-IBIG to take effective possession of property/titles of defaulting or defrauding borrowers.
            Naturally, the incident that happened in Pampanga makes us more cautious in the processing of take-outs. Pera ng mga miyembro ito at dapat lamang magkaroon ng pag-iingat. By this time, however, we should be back to our normal processing time but under a renewed drive and objective of making the system work better.
            Regarding permits for development and licenses, we are revisiting EO 45 which provides a one-stop shop facility in the processing of development permits, DAR clearance, license to sell, and the like. We are keenly pursuing an initiative to appeal to all agencies involved in the issuance of permits/clearances related to housing development to speed up their respective procedures and thus make the one-stop shop a reality.
            One aspect of the permitting process that you evidently dislike is in securing a conversion or exemption clearance from the DAR.
            As a former local executive myself, I strongly believe that the authority to convert land into residential use or exemption from agricultural use is vested in the local government and is in fact defined in the local government code. Any decision therefore made by any local government on conversion or reclassification of land makes whatever succeeding action of the DAR a ministerial act and therefore should not create delay for the developer to proceed with its construction.
            Right now, I am in the process of preparing a proposed executive order, for signature of the president, that will reinforce the authority of LGUs in converting or reclassifying lands for residential use as their exclusive domain, for as long as the land being reclassified or converted is covered or defined by an approved PLUP/CLUP of the local government unit.
            If the LGU does not have an approved PLUP/CLUP, the LGU can also have exclusive domain on the reclassification or conversion of lands if the same is within the definition of a non-productive land by DA. This is with the proviso, however, that conversion or reclassification is within the statutory limitation of not more than 15 per cent of the total land area of the LGU that could be devoted for residential purposes.
            Ito ay ipinangangako ko sa inyo na ipaglalaban ko at pipilitin  na matupad. 
            Titling is another concern and the costs of titling for socialized and low cost housing units must be reduced if not eliminated. We are conducting meetings with LRA to hasten the unitization of titles presently stranded in LRA’s on-going computerization project. Our proposal includes the priority handling of individual titling and supply of security paper for housing projects. We will also propose to reduce the fees being imposed for titling.
            Let me state unequivocally that I am one with you in advocating the immediate passage of the national land use act.
            We see the need to create a central government body that would ensure the just allocation, utilization management and development of the country’s land resources. I have written the NEDA thru Secretary Paderanga, who chairs the national land use committee, that HUDCC will be taking a proactive stance in pushing forward for the ratification of a National Land Use Act (NALUA).
As an urban planner myself, the need to preserve land, which is a finite resource, from competing uses will be of paramount concern. We need to protect land by rationalizing its utilization for agricultural production and food security, for industrial and commercial development and job creation, and for settlements development and affordable housing. 
            We must protect land from misuse and degradation not only for our own good but for the benefit of the country’s future generations. 
            Again, acting under such foresight, HUDCC will take a pro-active role in ensuring the passage of the National Land Use Act by the present congress.
            Capping our systemic reform efforts, HUDCC will prioritize the comprehensive review of virtually every nook and cranny of housing finance. 
            We shall reexamine the existing system of end-buyer financing, development financing, the guarantee system, the secondary mortgage market, the community mortgage program, and micro-housing program financing. This is with the end in view, of course, of making more funds available for housing. 
            The underlying premise of these reforms is to make mortgage instruments effective in securing ownership, and thus encourage buyers to accelerate payment or make timely payments on their obligations.
            At the same time and at all times, we will maintain the integrity of the mortgages so that more funds can be secured in the market for housing.
            Let me also briefly discuss other issues that concern you:
            On the matter of balanced housing or 20% compliance on socialized housing, our direction is to build more socialized housing units. Therefore, any alternative compliance on the balanced housing requirement should lead to building more socialized housing units. We are eliminating as alternative compliance the following:

            A.  The placement of funds into PAG-IBIG bonds instead of building 20% socialized housing units.

            B.  The contribution of P5,000 to the NHA socialized housing trust fund as credits for the balanced housing requirement. 
            We look forward to your suggestions on other forms of compliance, but the bottom line is that these alternatives should result in more socialized housing units.
            Our policy direction of partnering with the LGUs on housing presents an opportunity for private developers to engage in more housing businesses. I have ordered the creation of a special lending window in PAG-IBIG to entertain housing loan applications of local governments for its employees, as well as residents who are members of the fund. The partnership should result in reduced development costs, making houses more affordable because of the contribution or donation of the sponsoring LGUs. Private developers should not be wary of competition as the LGUs will be turning to you as their joint venture partners in land development, house construction and marketing.
            We will also continue to explore ways to get tax and fiscal incentives for developers. Currently the exemption from the vat on every sale of houses provides a relief to you and the buyers. We are negotiating with the BIR to effectively extend to developers the VAT exemptions on the purchase of construction materials.
            My dear friends, the foregoing are what you can expect from us. The system-wide reform that we will undertake or are already undertaking is intended to make it worth your while to partner with us. Your part of the partnership will make it worth the people’s while to avail themselves of our housing loans and services.
            Again, I return to the poet Auden who said, we must love one another or die. If that is asking too much, in housing let us say that you and I, the private sector and government, must work together or it is the people that will lose. Thus there is only one way to make our partnership work. We must make it win—for everyone.

            Thank you. May you have a fruitful convention.​