Despite a lean budget and layers of bureaucratic hurdles, Social Housing Finance Corporation (SHFC) president and CEO Federico Agustin Laxa is proving that the agency can deliver innovative, inclusive and community-driven housing solutions, particularly for informal settlers long sidelined by traditional urban development.

“It’s the constitutional right of every individual to have a home,” he told Daily Tribune on its show Straight Talk.

“SHFC is supposed to provide affordable housing for the poorer income segments, mostly informal settlers,” Laxa, recalling how the agency’s flagship Community Mortgage Program (CMP) was conceptualized during the era of the National Home Mortgage Finance Corporation, said.

“Instead of dealing with individual homeowners, we work with community associations. We lend to the entire community so they can acquire the land they already occupy.”

This approach transformed informal settlements into empowered communities, giving them the means to legally purchase land.

Through CMP, SHFC was able to provide affordable financing, as it accepts contributions from all members of the informal settler community in a specific area.

SHFC buys the land from the legal owners and allows long-term amortization periods of 25 to 30 years. In this way, informal settlers will be able to continue living in highly urbanized areas found in both Metro Manila and certain provinces, where they are already working or have job opportunities.

“When you relocate informal settlers to faraway places, it becomes a problem because they will go back to places where they can find livelihood,” Laxa said.

“Legitimate land owners also find it very difficult for them to get rid of informal settlers,” he added.

“We’re dealing with informal settlers occupying private lands. For many years, landowners were unable to utilize their land. SHFC steps in to finance land acquisition — so the community itself, using our loan, can buy the land.”

Landowners aren’t compelled to sell, but in many cases, they see no better alternative. “It’s tough to remove informal settlers. This gives them a way out — they get paid. And the settlers want to stay, because that’s where they grew up and found employment,” Laxa explained.

This is the crux of what makes SHFC’s model sustainable. “When you relocate people too far, they just come back. They abandon their units, rent them out, or sell them, and return to the city to find work,” said Laxa, who draws from his years of experience at both SHFC and the National Housing Authority.

Under the administration’s Pambansang Pabahay para sa Pilipino (4PH) program, SHFC has helped pioneer vertical housing developments in areas where land is limited or expensive.

Urban shelter solution

“In highly urbanized areas, the only way to go is up. We already have four 12-story buildings in San Fernando, Pampanga that are ready for occupancy. That project alone will house around 10,000 families. We have another in Davao City with 14 buildings, and one in Misamis Oriental, where there’s a housing shortage due to a growing industrial workforce,” Laxa said.

This vertical housing model, which features township-like amenities, aligns with the broader push of the Department of Human Settlements and Urban Development (DHSUD) to maximize land use while keeping workers close to job centers.

Laxa’s leadership has also breathed new life into stalled and abandoned housing projects. “When I assumed this position, there were projects that had been suspended for years. I made a commitment during a Senate hearing, especially to Senator Risa Hontiveros, to act on these. Today, we’re about to award units in Caloocan, Valenzuela and San Jose del Monte to families previously living near esteros and rivers,” he shared.

The beneficiaries of these hazard-zone relocation projects were initially identified by the Department of the Interior and Local Government (DILG) and local government units. SHFC ensures that all housing developments meet building codes and undergo comprehensive planning, which has often required correcting mistakes made in prior administrations.

“There were issues with access roads, water, power, and basic utilities. We had to fix all of that. You need a solid plan to make any housing project sustainable,” Laxa emphasized.

Navigating bureaucracy

While SHFC has made strides, Laxa is candid about the challenges. “You need permits from DHSUD, LGUs, the fire department, DENR (Department of Environment and Natural Resources), LRA (Land Registration Authority) , utility firms — it takes time and it’s costly. Developers can’t wait a year. They’ve already bought the land and taken out loans.”

He praised Department of Human Settlements and Urban Development Secretary Jose Ramon “Ping” Aliling’s vision of a one-stop shop for housing-related permits. “This would help accelerate housing production. Right now, the process has a bottleneck.”

One of Laxa’s significant initiatives is the revival of the CMP, which he sees as crucial in addressing homelessness among low-income earners.

“It’s more affordable. They’re already living there — we need to help them acquire the land and amortize it over 25 to 30 years,” he explained. CMP now offers on-site and off-site options, along with flexible financing for land acquisition and house construction, tailored to the community’s needs.

Unlike Singapore or Hong Kong, the Philippines has more land, but we need to develop it properly. Housing is not one-size-fits-all,” Laxa said. “That’s why DHSUD Secretary Aliling supports various modalities to address homelessness across income segments.”

Quiet impact, real progress

SHFC’s accomplishments may not always dominate headlines, but under Laxa’s leadership, its work is reshaping housing policy in ways that are practical, people-centered, and quietly revolutionary. Despite limited funding and a bureaucratic maze, the agency is unlocking land for the marginalized, ensuring vertical housing in dense cities, and correcting past missteps.

“Our approach is unique,” Laxa said. “We’re implementing programs like CMP that empower communities. We’re not just building houses. We’re building dignity, ownership, and long-term sustainability.”

Laxa vowed to accelerate further the delivery of housing finance solutions in partnerships with other government agencies and private firms.

President Ferdinand Marcos Jr. aims to address a significant housing backlog for lower-income families through the Pambansang Pabahay Para sa Pilipino Housing (4PH) program.

Under his leadership, Laxa stated that the government has produced 18,000 housing units in two years, “despite limited resources.”

“We have to expand modalities for 4PH to address a bigger income population, and we have to improve our production,” Laxa said as he shared the directives from Housing chief Aliling to SHFC.

Apart from financing informal settlers in long-inhabited areas, SHFC can acquire raw land and develop it to provide homes to more Filipinos.

“There are also informal settlers outside Metro Manila, and we have an off-site CMP where there is new land that can be developed for them, and they can ask for additional financing to put up their houses,” Laxa said.

Significant project rollout

Laxa said several families are already occupying a vertical, mid-rise housing project in Davao City, which is expected to feature more than 7,000 units.

He said 14 buildings were already finished, providing homes to 1,400 families. SHFC expects 12 more buildings to be completed in eight to 12 months.

The government has also completed a project in San Fernando, Pampanga which has four buildings with 12 stories each. Laxa said they can accommodate 10,000 families.

A vertical housing project was also dedicated to low-income families in Tagoloan, Misamis Oriental.

For informal settlers living beside rivers, estuaries and other danger zones, Laxa said he government has also produced 5,000 housing units located in Caloocan, Valenzuela and San Jose del Monte in Bulacan, among others. “These are ready for awarding,” he said.

In coordination with the Department of Transportation (DoTr), Laxa said 4,000 housing units have been completed to relocate informal settlers affected by the construction of railways that span from Manila to Calamba in Laguna.

“We have been preparing for that and if President Marcos wants to award most of these projects, we can already award,” he said.

“The beneficiaries are willing to relocate to San Pedro, Laguna because land in Muntinlupa City is now very expensive,” Laxa added.

He said housing projects are being constructed in other parts of Laguna, including Cabuyao and Sta. Rosa, which is seen to be finished within a year.

Laxa assured beneficiaries that the houses will be equipped with water and electricity devices.

In the past, he said homeowners’ associations agreed to take care of their water and power installations to reduce initial, overall costs.

“But I said the most critical component of a housing project is water and power. From the very beginning, that should be part of the funding, no matter what the homeowners say,” Laxa said.

SHFC partnered with Pag-IBIG Fund as a government joint venture to provide more affordable housing loans to Filipinos in the long run.

The tie-up aims to resolve inefficiencies in interest subsidies and budget allocations from the national government, as well as the unified lending program, by various financial government institutions.

Laxa said DHSUD and SHFC faced challenges in funding housing projects in the past due to limited interest subsidies and budget allocations from the national government.

From 2022 to 2024, Laxa stated that SHFC received only about P1.3 billion from the national government, or an average of approximately P300 per year, to implement CMP.

In 2022, he stated that the corporation received P500 million, but the amount subsequently declined to between P200 million and P100 million.

“Interest subsidy was suggested to support amortization costs. But given the limited resources and assets of SHFC, we cannot just borrow money from everywhere,” Laxa said.

With the Pag-IBIG partnership, he said SHFC was able to borrow P900 million.

Laxa added that the government also implemented the unified lending program for housing backed by the Social Security System and the Government Service Insurance System, among others.

“It was supposed to be a consolidation of funds for housing lending, but there were default problems,” he said.

“Basically, we find that the most financially sound institution for housing among the key agencies is Pag-IBIG because they have contributions from their members,” Laxa summed up.