Question & AnswerQ&A (PRESIDENTIAL DECREE NO. 957)
Presidential Decree No. 957 is commonly known as THE SUBDIVISION AND CONDOMINIUM BUYERS' PROTECTIVE DECREE.
The National Housing Authority has exclusive jurisdiction to regulate the real estate trade and business under Presidential Decree No. 957.
The registered owner must submit an approved subdivision or condominium plan, a sworn registration statement containing information about the owner and business, supporting documents such as approved plans, advertisements, financial statements, and title free from liens or encumbrances, and pay the prescribed registration fees.
Yes, after registration, the owner or dealer must obtain a license to sell from the National Housing Authority within two weeks before selling any subdivision lot or condominium unit.
The performance bond guarantees the construction and maintenance of subdivision or condominium project infrastructures such as roads, drainage, water, and lighting systems, and compliance with applicable laws and regulations.
Grounds include insolvency, violation of the Decree or Authority's rules, engagement in fraudulent transactions, misrepresentation in advertisements, bad business reputation, or failure to conduct business according to law and sound principles.
Real estate dealers, brokers, and salesmen must register with the National Housing Authority before engaging in the sale of subdivision lots or condominium units.
Violators may face administrative fines up to ten thousand pesos, criminal fines up to twenty thousand pesos, and/or imprisonment for up to ten years. Corporate officers may also be held criminally liable.
No, installment payments cannot be forfeited if the buyer desists from payment due to the developer's failure to develop the project according to approved plans and timelines. The buyer may be reimbursed with interest excluding delinquency interests.
The owner or developer must deliver the title to the buyer upon full payment without extra fees except registration fees and pay real estate taxes on lots or units until the title is transferred to the buyer. If the buyer has possession and occupancy, they become liable for taxes starting the following year.
No, alteration of roads, open spaces, or other subdivision developments in approved plans is prohibited without permission from the Authority and written consent of the homeowners association or majority of lot buyers.
The homeowners association promotes and protects the mutual interests of the buyers and residents and assists in community development.
No mortgage shall be made without prior written approval of the Authority. The mortgage proceeds must be used for project development, and buyers must be notified before loan release. Buyers may pay installments directly to the mortgagee to ensure prompt titling.
The Authority can investigate, suspend or revoke registrations, issue cease and desist orders, impose fines, deputize law enforcement, and take over development of projects if necessary.