7% cap on house rental increase
The House Plenary last Tuesday (May 26) unanimously ratified the bicameral conference committee report on a new rent control law that imposes a 1-year moratorium on rental increase and a 7% cap until 2013.
The report was the result of the bicameral conference committee meeting last May 20 on the disagreeing provisions in Senate Bill Number 3163 and House Bill Number 6098, which replaces the old rent control law that expired on Dec. 31 last year.
In addition to the 1-year prohibition on rental hike introduced by Bayan Muna Rep. Teddy Casiño, the bicameral conference committee also agreed to impose a 7% ceiling in annual rental increases for units charging rent from P1 to P10,000 in Metro Manila and P1 to P5,000 in other areas. This is lower than the old law's cap of 10%.
“Bayan Muna is happy about this development, since more than 1.54 million poor families living in rented houses, plus hundreds of thousands of bedspacers and dormitory residents will immediately benefit from this law,” said Casiño, a principal sponsor of the measure in the House and member of the bicameral conference committee.
Rep. Casiño hopes that the Bill will be signed into law before Congress adjourns on June 5.
“This law aims to protect poor families from higher and unreasonable rental payments at this time when we are feeling the adverse effects of the global economic recession. The enactment of the Rent Control Act will somehow relieve the families' burden of higher rentals,” said Casiño.
The prohibitions would apply to house and lot units, apartments and other dwelling places including boarding houses, dormitories, rooms and bedspaces offered for rent by their owners. It also includes residential units used for home industries, sari-sari stores or other business purposes which doubles as dwelling places for the business owner.
A two-year moratorium for rental increases was earlier proposed in House Bill No. 5849 sponsored by Rep. Casiño and co-authored by Bayan Muna representative Satur Ocampo, Gabriela representatives Liza Maza and Luzviminda Ilagan, and Anakpawis party representative Rafael Mariano. This was reduced to one year by the House and upheld by the bicameral conference committee.
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earlier news item:
House OKs rent control
By EDMER F. PANESA
May 7, 2009, 9:04am Manila Bulletin . com
The House of Representatives approved on final reading Tuesday night a bill that aims to protect millions of housing tenants in the country from unreasonable rent increases.
House Bill (HB) 6098 or the proposed “Rent Control Act of 2009” seeks to extend the country’s last rent control law, which expired last December 31, 2008 for another four years.
But unlike the previous rent control laws which have set a 10-percent cap annually on rent increases, the new measure imposes only a one-year moratorium on rent hikes and allows an increase of only up to four percent per year for the succeeding three years.
The approval of the measure was unanimous as all 186 House members present at Tuesday’s session voted in its favor.
HB 6098 was one of the 13 bills the House approved on third and reading. Its passage came a day after the legislative chamber received flak for its failure to hold session on Monday due to lack of quorum, which was brought about by the absence of a substantial number of congresspersons who were either in Las Vegas or have joined President Arroyo in her visits to Egypt and Syria.
Others approved on final reading are HB 5241, or the proposed Investments and Incentives Code of the Philippines; HB 6072, An Act Expanding the Promotion of Breastfeeding; and HB 6052, which would require all voters to undergo biometrics registration for elections.
Speaker Prospero Nograles, who was among those who flew to Las Vegas to watch the Pacquiao-Hatton fight last Sunday, expressed elation over the final approval of the new rent control law and other important legislation, saying it “compensated the unfortunate quorum problem that we had.”
“The passage of these measures was a responsive and collective action of both the leadership of the House and the members of the majority coalition with the critical cooperation of our colleagues in the minority,” the Speaker said in a statement.
Nograles, principal author of HB 6098, considers the measure as among the “socio-economic safety nets needed to protect millions of low-income Filipino families from the global recession gripping even the strongest of economies.”
Other authors of the bill are Reps. Rodolfo Valencia (Oriental Mindoro), Edgardo Chatto (Bohol), Eufrocino Codilla (Leyte), Raul del Mar (Cebu City), Pablo Garcia (Cebu), Teodoro Casiño (Bayan Muna), Eduardo Gullas (Cebu), Liza Maza (Gabriela), Ramon Durano VI (Cebu), Satur Ocampo (Bayan Muna), Pedro Romualdo (Camiguin), Glenn Chong (Biliran), Luz Ilagan (Gabriela), Roman Romulo (Pasig City), Rafael Mariano (Anakpawis), Neptali Gonzales II (Mandaluyong City), Del de Guzman (Marikina City), Victor Agbayani (Pangasinan) and Rene Velarde (Buhay).
The proposed “Rent Control Act of 2009” covers all residential units in Metro Manila and other highly urbanized cities rented for R10, 000 and below per month and those in other areas with monthly rent not exceeding P5, 000.
The bill provides that after the one-year moratorium, the rent of residential units covered by the measure shall not be increased by more than four percent annually as long as the unit is occupied by the same lessee.
When the unit becomes vacant, the renter may set the initial rent for the next lessee except in the case of boarding houses, dormitories, rooms and bed spaces offered for rent to students where the rent shall not increase more than once a year.
Exempted from the coverage of the law are rooms in a motel, hotel and resort.
If enacted, the new rent control law grants the Housing and Urban Development Coordinating Council (HUDCC) the authority to continue the regulation of rental fees of certain residential units after the lapse of the one-year moratorium and the three-year period of regulation.
HUDCC is also empowered to determine the residential units covered, and to adjust the allowable unit on rental increases per year, which shall not be more than the average monthly inflation rate on rentals of the immediately preceding year as determined by the National Statistics Office.
The measure prohibits the collection of more than one month as “advance rent” and two months “advance deposit.”
It also grants the lessor and the lessee the option to engage in a rent-to-own agreement that will result in the transfer of ownership to the latter. Such an agreement shall be expected from the limit on increase in rent.
The bill imposes a fine of not less than P5, 000 and not more than P15, 000 or imprisonment of 32 days to six months or both against those who shall be found guilty of violating any of the law’s provisions.
