NINETEENTH CONGRESS OF THE) 
REPUBLIC OF THE PHILIPPINES ) 
First Regular Session 
)
SENATE
S. No. 1232
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‘22 AUG 30 A9:28
Rl-CEiVLO m
Introduced by Senator Manuel "Lito" M. Lapid
AN ACT
ESTABLISHING A NATIONAL POLICY OF FREE HOUSING THROUGH 
USUFRUCT, PROVIDING FUNDS THEREFOR, AND FOR OTHER PURPOSES
EXPLANATORY NOTE
The Philippine housing industry believes that every Filipino family has the right 
to live with dignity in the comfort of one's own home regardless of economic status. 
Since the early 1990s, various housing finance programs offered long-term and low- 
interest rate loans, but these unfortunately failed due to mortgage defaults and poor 
collection efforts, among others. And even with the existence of low-cost housing, 
which should be inexpensive, the same cannot still be afforded by the intended 
beneficiaries, i.e., the indigent Filipinos.
In recognition of the policy of the State to institute programs aimed at providing 
its people access to housing and to pursue avenues that would make housing free to 
its citizens in need of it, as well as the lack of financial capacity of the indigent Filipinos 
to have their own houses, this bill seeks to provide such to qualified beneficiaries, i.e., 
underprivileged and homeless Filipinos without known ownership of any real property 
anywhere in the country, through a usufruct.
Thus far, our housing program has always operated under the principle of 
selling housing projects to beneficiaries at affordable prices payable over time. 
However, in many instances, beneficiaries end up selling the housing units awarded 
to them for profit instead of using them for their families. This defeats the purpose of 
the housing programs which is to actually house Filipino families.


The usufruct arrangement allows for the government to retain naked ownership 
over the units and keep the same for purposes of housing and away from the real 
estate market.
This program will allow the said beneficiaries free use of the property as a 
usufructuary, which means the State retains the ownership and title of the said 
property. Charges for utilities such as electricity, water and communication shall paid 
by the beneficiaries unless otherwise provided for by the LGU as included in the 
usufruct contract. The beneficiaries may enjoy the use of the property for residential 
purposes only until disqualified or until the same commit any of the prohibited acts 
provided for in this bill.
In view of this, early passage of this bill is sought.
lNUEL "LITO" m. lapid^
Senator 
d


NINETEENTH CONGRESS OF THE) 
REPUBLIC OF THE PHILIPPINES ) 
First Regular Session 
)
SENATE
s. no.1232
•22 ftUG 30 ft 9 ;28
RECEIVED Bv__
Introduced by Senator Manuel "Lito" M. Lapid
1 
AN ACT
2 
ESTABLISHING A NATIONAL POLICY OF FREE HOUSING THROUGH
3 
USUFRUCT, PROVIDING FUNDS THEREFOR, AND FOR OTHER PURPOSES
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled:
4 
Section 1. Short Title. - This Act shall be known as the '"Free Housing Through
5 
Usufruct Act of2022"
6 
Section 2. Statement of Policy. - As part of its mandate to promote a just and
7 
dynamic social order, it shall be the policy of the State to institute programs aimed at
8 
providing its people access to safe, decent, and affordable housing and pursue
9 
avenues that would make housing free to its citizens in need of it.
10 
Section 3. Free Housing Through Usufruct Program. - The National Housing
11 
Authority (NHA), Local Government Units (LGUs), and other government agencies
12 
engaged in housing in implementing their housing programs, shall as far as
13 
practicable, distribute housing units to qualified beneficiaries for free through
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contracts of usufruct.
15 
The NHA, LGU or other government agency engaged in housing or
16 
implementing housing projects, as usufructuary, shall retain ownership of title to the
17 
housing unit, with the beneficiary as usufructuary, allowed to enjoy the use of the
18 
property.


1 
Section 4. Qualified Beneficiaries. - Only underprivileged and homeless Filipinos
2 
without known ownership of any real property anywhere in the country may be
3 
beneficiaries of the free housing usufruct program. However, LCDs and other
4 
government agencies may extend the benefit to qualified personnel as part of its
5 
employee housing program.
6 
Section 5. Inclusions in the Contracts of the Usufruct - The Contracts for
7 
Usufruct shall only include use of the property subject to the prohibitions provided
8 
under Section 7 of this Act. Charges for utilities such as electricity, water and
9 
communication shall be for the account of the beneficiary unless otherwise provided
10 
for by the LGU as included in the usufruct contract.
11 
Section 6. Period of Usufruct - The beneficiary shall continue to enjoy use of
12 
the property until disqualified under Section 4 of this Act. In the event of death of the
13 
beneficiary, the next of kin shall have priority to take over the usufruct provided that
14 
the next of kin is qualified under the same section of this Act.
15 
Section 7. Prohibitions on the Usufruct - The beneficiary shall not lease, rent,
16 
sell or in any other manner transfer possession of the property under usufruct nor
17 
shall it be allowed to be used in whatever manner by any person other than the
18 
beneficiary or his immediate family. Further, the property shall only be used by the
19 
beneficiary for residential purposes. Violation of these prohibitions shall result in the
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forfeiture of the usufruct and constitute disqualification of the violator as beneficiary
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of any housing program by the government.
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Section 8. Financing, Ownership and Management - The NHA shail provide
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financial and technical assistance to the LGUs in the implementation of the program.
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Regardless of ownership of title to the properties subject of the program, the LGU
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where the housing project is located shall be responsible with the management and
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maintenance of the properties subject of the program. For purposes of this section,
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management shall include the determination of the beneficiaries of the program and
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maintenance shall include insuring that adequate utility services are accessible to the
29 
beneficiaries.


1 
Section 9. Appropriations. - An appropriation in the amount of Five Billion pesos
2 
(P5/000/000/000.00) is hereby allocated to the NHA as seed fund which will be tapped
3 
as assistance to LCDs for the implementation of the program. Subsequent allocations
4 
shall be appropriated in the annual General Appropriations Act as is needed to sustain
5 
the program.
6 
Section 10. Implementing Rules and Regulations. - The NHA, Department of
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the Interior and Local Government (DILG), and the Department of Human Settlements
8 
and Urban Development (DHSUD) shall promulgate the rules and regulations for the
9 
effective implementation of the provisions of this Act.
10 
Section 11. Separability Clause. - If any provision or part of this Act, or the
11 
application thereof to any person or circumstance, is held unconstitutional or invalid,
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the remainder of this Act shall not be affected thereby.
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Section 12. Repealing Clause. — All laws, presidential decrees, executive
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orders, proclamations, rules and regulations, or any part thereof, which are
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inconsistent with the provisions of this Act are hereby repealed or modified
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accordingly.
17 
Section 13. Effectivity Clause. — This Act shall take effect fifteen (15) days
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from its publication In the Official Gazette or in a newspaper of general circulation.
19
Approved,