Question & AnswerQ&A (Republic Act No. 9161)
The short title of Republic Act No. 9161 is the "Rental Reform Act of 2002."
The policy objective is to undertake a continuing program of urban land reform and housing that provides affordable decent housing and basic services to underprivileged and homeless citizens in urban centers and resettlement areas, including reforms in rental regulations of certain residential units.
From January 1, 2002, to December 31, 2004, monthly rentals of residential units not exceeding P7,500 in the National Capital Region and highly urbanized cities, and those not exceeding P4,000 in other areas, cannot be increased annually by more than 10% by the lessor.
A residential unit refers to an apartment, house, or land with a dwelling used for residential purposes including boarding houses, dormitories, rooms, and bedspaces for rent by owners, excluding motels and hotels. It also includes units used for home industries or businesses if the owner and family actually live there and use it mainly as a dwelling.
Rentals must be paid in advance within the first five days of each month or as agreed in the lease. The lessor cannot demand more than one month advance rental and two months deposit.
No, assignment of lease or subleasing of all or any portion of a residential unit, including accepting boarders or bedspacers, without written consent from the lessor is prohibited.
Grounds for ejectment include unauthorized assignment or subleasing, arrears of rent for three months, legitimate need of the lessor or immediate family to repossess the unit (with conditions), necessary repairs under condemnation orders, and expiration of the lease contract.
No, a lessor or successor cannot eject a lessee on the grounds that the leased premises were sold or mortgaged to a third party regardless of registration status.
The lessor and lessee may enter into a written rent-to-own agreement that will transfer ownership to the lessee. Such agreements are exempt from rental increase limits in Section 3 of the Act.
Violators may face a fine of P5,000 to P15,000, or imprisonment from one month and one day to six months, or both, depending on the case.