Joint-venture arrangements remain largely under-maximized in the affordable housing segment, despite the fact that they hold promise in solving the country’s housing backlog. This was disclosed by Pinnacle’s president and managing director Michael Mabutol during the SHDA national convention.

The convention, which was held in Cagayan de Oro City last September 13 and 14, was one of the largest gatherings of real estate developers in the Philippines. In his presentation, Mabutol explores the potential of joint ventures in solving the country’s ever-growing housing backlog. He enumerated the ways in which Philippine real estate can be made more attractive for foreign firms to venture into the country’s housing market.



There are several ways in which the Philippines can attract joint-venture capital. First of which is by sustaining the country’s robust macro-economic fundamentals. “A strong economy indirectly fuels demand by putting much-needed money to households. A steady household cash flow can encourage stakeholders to put their capital to housing projects because of greater demand with lesser risk of defaults.”

A second strategy is to keep a robust real estate market to incentivize participation of joint-venture stakeholders, especially foreign players. “Participants in joint-venture housing development would certainly enjoy the current uptrend of the market as it can mean a healthy investment,” said Mabutol. He further said that a seller’s market is usually desired by investors into housing developments as it shows supply absorption of a targeted market.

Finally, improving the country’s regulatory framework that governs the housing sector would send a message to foreign players that measures are in place to protect their business interest, said Mabutol. “This is where the country can improve a lot.”



One such move is the passage of relevant pieces of legislation in housing, including the formation of the Department of Housing and Urban Development, the National Land Use Act, and the amended Comprehensive and Integrated Shelter Finance Act.

Data from the Housing and Urban Development Coordinating Council (HUDCC) shows that the country’s housing backlog is already at 2.0 million dwelling units, primarily affecting the socialized and economic housing segment. This number is estimated to balloon to about 6.8 million shelters by 2022.