Housing regulations designed to speed up project development may instead squeeze developers’ cash flow and further slow housing production, according to Chamber of Real Estate and Builders’ Associations (CREBA) National Chairman Noel Cariño.
Cariño raised concerns over the revived Temporary License to Sell (TLS), which allows developers to presell projects while completing requirements for a permanent license to sell.
While the mechanism is intended to keep projects moving, Cariño said its economic benefit is undermined if developers cannot use collections generated under the temporary permit.
“If you cannot even use the funds, of what value is the temporary license to sell?” Cariño said. “You’re allowed to promote the project without using the economic benefits of your activity.”
By the time developers apply for a license to sell, they have already committed substantial capital to land acquisition, planning, permits, and other project requirements, he said.
Cariño stressed that developers are not depending on preselling proceeds to finance an entire project. But additional cash flow, he argued, can help accelerate construction and keep developments moving.
The issue comes as the Philippines continues to grapple with a widening housing shortage. Cariño estimated current housing production at fewer than 200,000 units annually, well below a previously discussed target of 500,000 units a year.
CREBA is also pushing for a review of Section 18 of the Urban Development and Housing Act of 1992, or the balanced housing requirement, arguing that compliance adds costs that eventually find their way into the price paid by homebuyers.
“We want it replaced,” Cariño said. “Come up with a more responsive, realistic and progressive solution.”
For CREBA, the broader concern is that well-intentioned rules can produce the opposite effect when they restrict capital and add costs to an industry already facing significant barriers to building more homes.
Cariño urged regulators to treat developers as partners in addressing the housing shortage rather than view the industry solely through a regulatory lens.
The challenge, he suggested, is to design rules that protect buyers without putting the brakes on the very projects needed to close the country’s housing gap.
