REAL ESTATE GUIDE

By Real Estate Broker Raquel G. Kim

PHILIPPINE LAW
RESA Law (R.A. 9646)
DHSUD (R.A. 11201)
P.D. 957
LAD, a component of CARP
(R.A.6657)
Maceda Law (R.A. 6552)
Building Code (R.A 6541)
Real Estate Service Act or RESA
Law (R.A. 9646)
Section 2 of the law states that, “The State recognizes the vital role of real estate service
practitioners in the social political, economic development and progress of the country by
promoting the real estate market, stimulating economic activity and enhancing government
income from real property-based transactions. Hence, it shall develop and nurture through
proper and effective regulation and supervision a corps
of technically competent, responsible and respected
professional real estate service practitioners whose standards
of practice and service shall be globally competitive and will promote the growth of the real
estate industry.”

Who are the real estate service practitioners under the RESA Law?

Real Estate Consultants, Real Estate Appraisers, Real

Estate Assessors, Real Estate Brokers, and Real Estate
Salespersons
RESA Law
Real Estate Salesperson
Accredited Real Estate
Salesperson
Real Estate Sales Agent
Property Consultant
Property Specialist
Department of Human Settlements and Urban
Development – DHSUD (R.A. 11201)

Section 4. Creation and Mandate of the Department of Human Settlements and Urban
Development. - There is hereby created the Department of Human Settlements and Urban
Development, hereinafter referred to as the Department, through the consolidation of the
Housing and Urban Development Coordinating Council (HUDCC) and the Housing and
Land Use Regulatory Board (HLURB). The Department shall act as the primary national
responsible for the management of
government entity

housing, human settlement and urban

development. It shall be the sole and main planning and policy-making,
regulatory, program coordination, and performance monitoring entity for all housing, human
settlement and urban development concerns, primarily focusing on the access to and the
affordability of basic human needs. It shall develop and adopt a national strategy to
immediately address the provision of adequate and affordable housing to all Filipinos, and
shall ensure the alignment of the policies, programs, and projects of all its attached
agencies to facilitate the achievement of this objective.
Subdivision and Condominium
Buyers’ Protective Decree (P.D.
957)
Under the government of the late President, Mr. Ferdinand E. Marcos,
Presidential Decree No. 957 is passed to closely supervise and regulate real
estate practitioners, owners, and developers in the Philippines.

to protect buyers’ welfare

The primary purpose of this law is
from all types of real estate misrepresentations.
Land Acquisition and Distribution,
a component of Comprehensive Agrarian
Reform Program (R.A. 6657)
In general, (1) only Filipino citizens; and (2) corporations
or partnerships with least 60% of the shares owned by
Filipinos, are entitled to own or acquire land in the
Philippines.

The Condominium Act (R.A. 4726)

Foreigners or non-Philippine nationals may, however,
purchase condominiums, buildings, and enter into a long-
term land lease.
Realty Installment Buyer Act or
Maceda Law (R.A. 6552)
It is embodied in R.A. 6552 which provides for certain
protection to particular buyers of real estate payable on
installments. The law declares as "public policy to protect
buyers of real estate on installment payments
against onerous and oppressive conditions.
Maceda Law (R.A. 6552)
What are the rights granted to buyers?
1. Buyer paid at least 2 years installment
a. Pay without interest the balance within grace period of 1 month for
every year of installment payment. Grace period to be exercised once
every 5 years.
b. When no payment – cancelled; buyer entitled to 50% of what he
has paid + 5% for every year but not exceeding 90% of payments made.

2. Buyer paid less than 2 years installment

a. Grace period is not less than 60 days from due date
b. Cancellation if failure to pay w/in 60 days grace
c. 30 days notice before final cancellation

Note: Buyer can still pay w/in the 30 days period with interest.
National Building Code
(R.A. 6541)
The National Building Code of the Philippines was written and published
by the Department of Public Works and Highways (DPWH). The National
Building Code of the to ensure that
Philippines aims
developers conform to the implementation of
modern technical knowledge on construction,
building design, occupancy, maintenance, and
use.

Building Permit - application, process, compliance,

revocation, exemption, and enforcement
 GOVERNING BODIES IN REAL ESTATE
(P.D. 957, R.A. 9646)

PROFESSIONAL DEPARTMENT NATIONAL PROFESSIONAL

REGULATION OF HUMAN HOUSING REGULATORY
COMMISSION SETTLEMENTS AUTHORITY BOARD OF REAL
(PRC) AND URBAN (NHA) ESTATE SERVICE
DEVELOPMENT (PAREB)
(DHSUD)
 TERMS
and
DEFINITIONS
 DEVELOPER – any natural or juridical
person engaged in the business of
developing real estate development project
for his/her or its own account and offering
them for sale or lease.
DEALER – the person / company directly
engaged as principal in the business of
buying, selling, or exchanging real estate
whether on a full-time or part-time basis.

BROKER – any person who, for

REAL ESTATE BROKER
commission or other compensation,
undertakes to sell or negotiate the sale of
the real estate belonging to another.

REAL ESTATE SALESPERSON

SALESPERSON – the person regularly
employed by a broker to perform, for and
on his behalf, any or all functions of a Real
Estate Broker.
Reference: P.D.
DEVELOPER

MARKETING
ARM
 LICENSE TO SELL - Such owner or dealer to whom has been issued a
registration certificate shall not, however, be authorized to sell any
subdivision lot or condominium unit in the registered project unless he
shall have first obtained a license to sell the project within two weeks from the
registration of such project.

REGISTRATION - All contracts to sell, deeds of sale and other similar

instruments relative to the sale or conveyance of the subdivision lots and
condominium units, whether or not the purchase price is paid in full, shall be
registered by the seller in the Office of the Register of Deeds of the
province or city where the property is situated.

MORTGAGES - No mortgage on any unit or lot shall be made by the

owner or developer without prior written approval of the Authority. Such
approval shall not be granted unless it is shown that the proceeds of the
mortgage loan shall be used for the development of the condominium or
subdivision project and effective measures have been provided to ensure
such utilization. The loan value of each lot or unit covered by the mortgage
shall be determined and the buyer thereof, if any, shall be notified before the
release of the loan.

Reference: P.D.
 REAL ESTATE TAX - Real estate tax and assessment on a lot or unit
shall be paid by the owner or developer without recourse to the buyer for as long
as the title has not passed the buyer; Provided, however, that if the buyer has
actually taken possession of and occupied the lot or unit, he shall be liable to the
owner or developer for such tax and assessment effective the year following
such taking of possession and occupancy.

ORGANIZATION OF HOMEOWNERS ASSOCIATION - The

owner or developer of a subdivision project or condominium project shall initiate
the organization of a homeowners association among the buyers and
residents of the projects for the purpose of promoting and protecting their
mutual interest and assist in their community development.

ISSUANCE OF TITLE - The owner or developer shall deliver the title of

the lot or unit to the buyer upon full payment of the lot or unit. No fee,
except those required for the registration of the deed of sale in the Registry of
Deeds, shall be collected for the issuance of such title.

Reference: P.D.
HOME DEVELOPMENT
MUTUAL FUND (HDMF)
R.A. 9679

commonly known as

PAG-IBIG
PAG-tutulungan sa Kinabukasan:
I-kaw
B-angko
I-ndustriya at
G-obyerno
UNDERSTANDING
THE SAMPLE
COMPUTATION *

* Subject to change
without prior notice.
 Selling Price
+ Miscellaneous Fees

= TOTAL CONTRACT PRICE

- sum of all the costs to be
paid by the buyer.
RESERVATION FEE - a payment
made by the buyer to the developer to hold
a property and is usually good for 30 days. It
is deductible from the selling price for
Spot Cash payment or at the Down
Payment if its thru Financing.
 Selling Price
+ Miscellaneous Fees

= TOTAL CONTRACT PRICE

- Loanable Amount

= DOWN PAYMENT
- paid by the buyer upfront
DP Terms: and it represents a
Spot DP percentage of the total
10% DP contract price.
20% DP Other term: EQUITY
 Selling Price
+ Miscellaneous Fees

= TOTAL CONTRACT PRICE

- Down Payment

= LOANABLE AMOUNT

The estimated monthly

amortization and required basic
monthly income will depend on
the age of the Principal
Borrower.
 IF THE BUYER IS SINGLE

1 2 3
PRINCIPAL PRINCIPAL
PRINCIPAL BORROWE BORROWE
BORROWER R R
CO-
ATTORNEY-
BORROWE
IN-FACT
R

Requirements (Buyer, Co-Borrower, AIF)

2 valid Government-issued IDs with 3 specimen signatures, Birth Certificate, Certificate of No
Marriage (CENOMAR), Special Power of Attorney
IF THE BUYERS ARE MARRIED
1 2
PRINCIPAL PRINCIPAL
BORROWE BORROWE
R R

MARRIED MARRIED
TO TO
AIF

Note: Title will reflect – John Doe, married to Jane Doe, ……

Requirements (for all parties)
2 valid Government-issued IDs with 3 specimen signatures, Marriage Certificate, Special Power of
Attorney
IF THE BUYERS ARE MARRIED

1 2
AND AND
SPOUSE SPOUSE SPOUSE SPOUSE

AIF

Note: Title will reflect – John Doe and Jane Doe, ……

Requirements (for all parties)
2 valid Government-issued IDs with 3 specimen signatures, Marriage Certificate, Special Power of
Attorney
 IF THE LAND BUYER IS MARRIED TO A
FOREIGN NATIONAL

1 2 3
PRINCIPAL PRINCIPAL
PRINCIPAL BORROWE BORROWE
BORROWER R R
CO-
ATTORNEY-
BORROWE
IN-FACT
R
Note: Land Title will reflect – Filipino buyer’s name only (LAD R.A. 6657)
Requirements (Buyer, Co-Borrower, AIF)
2 valid Government-issued IDs with 3 specimen signatures, Marriage Certificate, Special Power
of Attorney
IF THE CONDO UNIT BUYER IS MARRIED
TO A FOREIGN NATIONAL

1 2
AND PRINCIPAL
SPOUSE SPOUSE BORROWE
R
MARRIED
TO

Note: Condo Title will reflect – John Doe and Jane Doe or John Doe,
married to Jane Doe,… (The Condominium Act R.A.4726)
Requirements (for all parties)
2 valid Government-issued IDs with 3 specimen signatures, Marriage Certificate, Special Power of
Attorney
 PART 2

To be continued
SAMPLE FORMS
Developers
Pag-iBig / HDMF
Bank Financing
In-House Financing