CONTINUING PROFESSIONAL

EDUCATION

SUBDIVISION DEVELOPMENT
(Legal)

CRB Bong Cruz

 VP Jejomar Binay

Housing & Land Use

Regulatory Board
Home Guaranty
Corporation

National Housing
Authority
Home Development National Home
Mutual Fund Mortgage Corporation
 PD #957:
THE SUBDIVISION & CONDOMINIUM
BUYER’S PROTECTIVE DECREE
Regulating the sale of subdivision or
subdivision lots & condominiums,
providing penalties for violations thereof

Implementing arm:
Housing & Land Use Regulatory Board
(HLURB)
 REGISTRATION of PROJECTS
1. Name of owner
2. The location of the owner’s principal business
office
3. The names & addresses of all directors &
officers of the business firm
4. The general character of the business actually
transacted by the owner
5. A statement of the capitalization of the owner
Attachments to Project Registration
1. A copy of the subdivision or condominium
plan
2. A copy of any circular, prospectus, brochure
or advertisement
3. A balance sheet showing all assets & liabilities
4. A title to the property, if free from all liens &
encumbrances

Document to be issued:
Certificate of Registration
 LICENSE TO SELL
 Must be secured within two weeks after receipt
of the CR
 Certifies that:
-- owner or dealer is of good repute
-- his business is financially stable
-- the proposed sale would not be fraudulent
SUSPENSION of the LICENSE TO SELL
1. Any information filed by the owner or dealer
was misleading, incorrect, inadequate or
incomplete
2. The sale or offering of the sale may result in a
fraud upon prospective buyers
REVOCATION of CR & LICENSE to SELL
When the owner or dealer:
1. Becomes insolvent
2. Has violated any provisions of this Decree
3. Has been or is engaged or about to engage in
fraudulent transaction
4. Has made any misrepresentation in any
prospectus, brochure or circular of the project
5. Is of bad business repute
6. Does not conduct his business according to law
or sound business principles
 EXEMPTIONS
1. Sale of a subdivision lot resulting from the
partition of land among co-owners or co-heirs
2. Sale or transfer of subdivision lot or a
condominium unit by the original buyer &
subsequent sale of the same property
3. Sale of subdivision lot or condominium unit by
the mortgagee to liquidate a bonafide debt
4. Bulk buying (when sold as bought)
 PERFORMANCE BOND
 Amount: equivalent to the balance of the value
of the undeveloped portion of the project
 To guarantee the construction & maintenance of
the roads, gutters, drainage & sewerage
 Authorizes the HLURB to use the performance
bond to complete the project development
 SECTION 11:
REGISTRATION of DEALERS,
BROKERS & SALESMEN
No real estate dealer, broker or salesman shall
engage in the business of selling subdivision lots or
condominium units unless he has registered with
the HLURB.
REVOCATION of REGISTRATION of
DEALERS, BROKERS & SALESMEN
 Has violated any provision of this Decree
 Has made a material false statement in his
application
 Has been guilty of fraudulent act
 Has demonstrated his unworthiness
 MORTGAGE by DEVELOPER
 Cannot be done by the developer without prior
approval by the HLURB
 Can only be allowed by the HLURB if the
proceeds of the loan will be used for the
development of the project
 An escrow account will be opened involving
HLURB and the developer
 ADVERTISEMENT
 Must reflect the real fact & must not be
misleading or deceiving
 The owner or developer shall be answerable &
liable for those contained in all ad materials
 TIME COMPLETION
 Within one year from the issuance of the
license to sell

NON-FORFEITURE OF PAYMENTS:
No installment payments by the buyer shall be
forfeited by the owner or developer for his
failure to finish the development within the
time frame required.
FAILURE TO PAY INSTALLMENTS
 Covered by RA #6552 (The Maceda Law)

ISSUANCE OF TITLE:
 Upon full payment
 If mortgaged by developer, he should redeem &
deliver the title within six months
 PROPERTY TAX
 Shall be paid by the developer if title has not
been passed on to the buyer
 However, if the buyer has already taken
possession of the property, property tax will now
be paid by the buyer
 OTHER PROVISIONS
ACCESS TO PUBLIC OFFICES IN THE
SUBDIVISION:
No developer shall deny any person free access to
any public office located within the subdivision or
may be reached only through the subdivision.

RIGHT OF WAY TO PUBLIC ROAD:

The developer must secure right of way access to
any existing public road.
ORGANIZATION OF HOMEOWNERS
ASSOCIATION:
Shall be initiated by the developer and organized
among the buyers & residents of the project

DONATION OF ROADS & SPACES TO THE LGU:

At the option of the developer
Once donation is accepted, cannot be converted
for any other purpose
TAKE-OVER DEVELOPMENT:
HLURB may take-over & complete the
development of the project at owner’s expense
if they refused or failed to develop & complete
the project.
After the take-over, HLURB may demand,
collect and receive installment payments which
shall then be used for the project.
 RA 7279:
THE URBAN DEVELOPMENT &
HOUSING ACT (UDHA) of 1992
BALANCED HOUSING DEVELOPMENT:
A subdivision or condominium developer must
also develop the equivalent of 20% of his project
for socialized housing.
EXEMPTIONS:
1.Socialized housing project development
2.With four units or less

MODE OF COMPLIANCE:
1.20% of the total land area
2.20% of the total project cost
 Mode of compliance
1. New settlements
2. Slum upgrading
3. Community Mortgage Program (CMP)
4. Joint venture projects with LGU
5. Joint venture projects with NHA
6. Housing/Pabahay Bonds
 OTHER PROVISIONS
CREDITS:
May develop in excess of the required 20% to build
up future credits to be used later

PROJECT LOCATION:
If no single land is feasible or available in the
locality, development of separate sites is allowed.

TIME OF COMPLETION:
One year from issuance of the License to Sell.
 PD #1216:
DEFINING REQUIRED “OPEN SPACE”
in RESIDENTIAL SUBDIVISIONS
REQUIRED:
Developer must allocate 30% of the gross area of any
development project for open space.

OPEN SPACE:
An area reserved exclusively for parks, roads, alleys,
sidewalks, playgrounds, recreational uses, centers,
clubhouses and other similar facilities & amenities
 COVERAGE:
Project lot area of one hectare or more.

ALLOCATION FOR PARKS, PLAYGROUNDS &

RECREATIONAL USE
(must not be all 30% for roads)
LAND DENSITY (per hectare) CATEGORY ALLOCATION
66 to 100 family lots High density or 9.0%
socialized housing
21 to 65 family lots Medium density or 7.0%
economic housing
20 family lots or below Low density or open 3.5%
market housing
CONTINUING PROFESSIONAL
EDUCATION

SUBDIVISION DEVELOPMENT
CRB Bong Cruz