Law Summary
Bulk Buying as an Exempt Transaction
- If a bulk buyer sells lots without making any alterations as per PD 957, such resale is classified as a subsequent sale.
- This type of transaction is considered exempt under Section 7 of PD 957.
- Therefore, the bulk buyer is not required to obtain a license to sell from the Housing and Land Use Regulatory Board (HLRB).
Bulk Buying with Construction of Housing Units or Structures
- A bulk buyer who builds housing units or structures on the purchased lots without subdividing or altering roads and utilities must secure a locational clearance from HLRB or its deputee.
- The construction must conform to the allowed density specified in the approved subdivision plan.
- The original owner or developer remains responsible for the completion and maintenance of roads and other facilities.
- If construction increases density beyond the approved plan, the bulk buyer must:
- Obtain consent from the original developer and the majority of lot buyers or the Home Owners Association (HOA).
- Demonstrate that existing facilities meet required standards and regulations.
Bulk Buying with Alteration and Re-subdivision
- If alterations introduced by a bulk buyer result in re-subdivision and issuance of new titles, the bulk buyer is considered the owner/developer of a new subdivision.
- The new subdivision is separate and distinct from the original and is subject to all requirements under PD 957 and related laws.
- This includes compliance with locational clearances, right-of-way provisions, and all regulatory processes.
- If the new project depends on facilities and amenities of the original subdivision which have not been turned over to the local government unit, the bulk buyer must secure approval from:
- The original subdivision owner.
- The majority of lot buyers.
- The Home Owners Association (HOA), if existing.
Regulatory Purpose and Protection for Buying Public
- The Rules and Regulations on Bulk Buying aim to prevent speculative purchases that may harm the buying public.
- They provide a uniform basis for HLRB’s adjudication and enforcement concerning bulk buying activities.
- The framework ensures that quality, facility standards, and ownership rights in subdivisions are maintained and protected under PD 957 and related laws.