Senate weighs options on rent control law

Published by rudy Date posted on January 22, 2009

The Senate is mulling over the possibility of enacting a permanent rent control law, instead of merely extending the law by three years or more upon its expiration.

This option was suggested yesterday as the Senate committee on urban planning, housing and resettlement tackled the bill extending the rent control law, which expired Dec. 3l, 2008.

Senator Rodolfo Biazon, committee chairman, said a permanent law means that the l0-percent limit on the increase in the monthly rental for housing and apartment units will be continuously implemented until repealed by Congress.

Biazon said there is also a move to raise the ceiling on the amount of rental from Pl0,000 under the old law.

Senator Juan Miguel Zubiri, author of the rent control bill, said he favors raising the ceiling to Pl2,000.

Three other options are being considered by the committee.

There is a proposal authorizing the Housing and Urban Development Coordinating Council to decide on whether to continuously enforce rent control or not, as well as determining the scope of its coverage. Another option is to revert to the previous practice of extending rent control for three years.

Biazon said the senators are also not ruling out the possibility of just doing away with the rent control altogether and leave the prices of rent to the free market.

“There are those who opine that a rent control is a disincentive to investors for the construction of new units for rent. This, in turn, has affected the quality, supply and the price of units for rent to the detriment of the renters themselves,” he said.

Zubiri warned that the non-extension of the rent control law would severely hurt the poor and middle-income families living in rented houses. After the last extension lapsed at the end of 2008, he said some apartment dwellers complained that their monthly rent was doubled or even tripled.

In a position paper, the Home Development Mutual Fund or Pag-Ibig, headed by Romero Quimbo, said with the effects of the global financial crisis setting in, another extension of the rent control law is “imperative and timely” to protect low-income families from excessive rent hike.

“The rental housing market tends to be monopolistic and rent control may be necessary to prevent economic eviction and abuses on the payment of key monies,” the Pag-Ibig Fund said.

It added that rent control would not necessarily discourage the production of housing units intended for rent.

Zubiri batted for the imposition of stiffer penalties for violators of the law or those who will increase rent for covered units by more than l0 percent and those who will evict lessees for conditions not sanctioned by the law.

Under the law, violators can be fined for P500 up to Pl5,000 and imprisoned for not less than one month to not more than six months.

Zubiri proposed that the penalty be raised to a minimum of P50,000 to a maximum of Pl00,000.

Complaints against violations may be filed before the municipal or city trial. –Fel V. Maragay, Manila Standard Today

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