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P.D. 957 addresses some of the common inquiries pertaining to the purchase of subdivision and condominium units below:

What are the requirements that real estate developers need to comply prior to the construction and sale of the project?

Under the law, the owner, real estate developer, or dealer is required to submit a plan and secure a development permit from the Department of Human Settlements and Urban Development (“DHSUD”) prior to the construction and establishment of condominium units or subdivisions. Next, it is important to note that after obtaining the approved plan and permit, the owner, real estate developer, or dealer is mandated to register their project and obtain a license to sell (“LTS”) within two (2) weeks from the registration from the same government agency. 

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What are the obligations of the real estate developers to the buyers with regard to completion of the project and delivery of title of the property?

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With respect to the timeline for the project completion, pursuant to Section 20 of P.D. 957, real estate developers are given one (1) year from the date of the issuance of the license for the subdivision or condominium project, or such other period of time as may be fixed by DHSUD to construct and provide the facilities, improvements, infrastructures, and other forms of development, including water supply and lighting facilities, which it/he offered and indicated in the approved subdivision or condominium plans, brochures, prospectus, printed matters, letters or in any form of advertisement.

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With respect to the delivery of the title, according to Section 25 of P.D. 957, the real estate developer is obliged to deliver the title of the subdivision lot or condominium unit to the buyer upon full payment of the lot or unit. In compliance with said obligation, no fees, except those for the registration of the deed of sale in the Registry of Deeds, shall be collected by the real estate developer for the issuance of the title.

What happens to the real estate developer if it fails to fulfill with the aforesaid obligations?

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The DHSUD may impose an administrative fine not exceeding ten thousand pesos (PhP10,000.00) for violations of the provisions of this Decree or of any rule or regulation as may be applicable. Furthemore, under Section 39 of P.D. 957, the real estate developer shall be punished by a fine of not more than twenty thousand (P20,000.00) pesos and/or imprisonment of not more than ten years.

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Disclaimer: This article is for informational purposes only and should not be considered legal advice. For specific guidance on the Subdivision and Condominium Buyers’ Protective Decree,  consult with a legal professional.

‍Padin & Partners Law Offices is a full-service law firm based in Cebu City, Cebu Philippines, that offers legal services such as the filing of cases on violations under Subdivision and Condominium Buyers’ Protective Decree in Cebu City, Cebu, Philippines. For consultations: book an appointment or reach us at +63 (32) 316-1540 or +63 917 188 0361.