President signs Rent Control Act into law

President Gloria Arroyo on Tuesday signed into law Republic Act 9653, otherwise known as the Rent Control Act of 2009, which authorizes a one-year moratorium on rent increases in residential units.

Under the law, no rent increase shall be imposed in any residential units covered under the Act for a period of one year of its effectivity.

The government said that once the law takes effect, it would impose a moratorium on housing rental increases for a year and pegs any rental increase to only 7 percent after that, until December 31, 2013.

 The law will benefit some 1.5 million low-income tenants across the country, the majority of whom are paying a monthly rent of P10,000 or less, officials said.

Covered under the Rent Control Act of 2009 are dwelling units in the National Capital Region and highly urbanized cities whose monthly rent ranges up to P10,000; as well as units located in other areas whose rent ranges up to P5,000.

These include apartments, houses, lands, buildings or parts thereof, boarding houses, dormitories, home industries and retail stores being rented but are also used as dwelling places.

In case of boarding houses, dormitories, rooms and bedspaces offered for rent to students, increase in rental should be allowed only once a year.

Under the new law, owners of residential units are allowed to impose not more than one month advance rent and not more than two months deposit.

Based on the 2006 Family Income and Expenditure Survey, about 1.6 million families are renting their dwelling units nationwide with about 1.55 million, or 96 percent paying monthly rent of P10,000 or less.

Executive Secretary Eduardo Ermita said the signing of the law is very important particularly at times that the country experiences economic crisis.

“We have an economic slowdown and the significance of the Rent Control Law is that it would somehow assist or help our lesser privileged citizens so that they will not bear the burden of uncontrollable increases in rental of their places of abode,” he said.

The President enacted the Rent Control Law in simple ceremonies Tuesday morning in Malacañang.

Witnessing the enactment of the consolidated version of Senate Bill 3163 and House Bill 6098 were Vice President Noli de Castro, Executive Secretary Eduardo Ermita, Senate Majority Leader Sen. Juan Miguel Zubiri, House Speaker Prospero Nograles, House Deputy Speaker Rep. Amelita Villarosa and Public Works Secretary Hermogenes Ebdane, who is also a member of the Housing and Urban Development Coordinating Council (HUDCC).

Also witnessing the signing were principal author Rep. Rodolfo Valencia of Oriental Mindoro First District and several House members who were co-sponsors of the new rent control law.

Zubiri said “the new Rent Control Act is one of the socio-economic measures that Congress has lined up to ease the burden of Filipinos in the face of global economic crisis.”

Zubiri is principal author and co-sponsor of Sen. Rodolfo Biazon of the law in the Senate.

“The law provides for a one-year moratorium on rent increases, so the 7 percent could be effective only on July 14, 2010. However, we could no longer do anything for those who already had their rents increased after December 31, 2008 and before the signing of the new law,” he explained.

He said that the new law authorized HUDCC to adjust the allowable limit on rental increases per year after December 31, 2013 and to determine if more extensions were warranted.

 HUDCC Assistant Secretary Celia Alba said their office and the Department of Interior and Local Government, in coordination with other concerned agencies, are tasked to conduct a nationwide information drive on the provisions of the new rent control law.

Alba said the HUDCC was also tasked to conduct a review of the implementation of the new law, a study on rental regulation, and submit to Congress its recommendation whether a continuing regulation or deregulation is necessary. –Angelo S. Samonte And Efren L. Danao, Reporters, Manila Times