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§ Republic Act 4626 and House Bill 970 Amendment.
§ Planning stage
§ Development stage
§ Condominium management stage
§ Choosing a suitable location, normally in high-population density areas
§ Determining the following: USAGE TYPE- residential, commercial, office, hotel; Budget- high or low; DESIGN - high rise, townhouse, twin tower; FUNDING - bank financing or direct investment or joint; CONSTRUCTION FEATURES- number of floors, units/floors, basement levels, facilities and services, land area; ARCHITECTURAL DESIGN - choice of architect
§ Selection of constructor or builder
§ Consolidation of the master plan
§ Cost estimates- labor, material, miscellaneous
§ Bid solicitations and adjudication
§ Application/ registration for building permit
§ Application with DENR for Environmental Compliance Certificate
§ Application for development permit with HLURB
§ Application must be done with city or municipality where the project will be constructed as in ordinary building construction. Application is coursed through the city/municipal engineer, the fire department, the planning and zoning authority, and finally, to the city/municipality mayor.
§ This is the Environmental Compliance Certificate attesting that the land on which the project is to be constructed is not within the prohibited zones where the environment is projected. Or that the project will observe rules set to promote environmental protection or that the project will observe rules set to promote environmental protection.
§ Description of land (with survey plan)
§ Description of building, number of stories, units and their accessories (with diagram of floor plans)
§ Description of the common areas and facilities
§ Description of the interest to be acquired by unit-buyers and those of the common areas
§ Declaration of restrictions or purposes for which the condominium project is intended or restricted as to usage
§ Certification of the registration if such is undertaken for him by representative
§ Declaration of Restrictions shall provide for the management body i.e. condominium corporation if units may be offered for sale to foreigners or association of condo owners, or board of governors elected or managements agent likewise elected or by the board of directors or if corporation, whether stock/ non-stock
§ It shall also provide for voting majorities, quorums, meeting dates, and other rules to govern such body
§ Power to enforce declaration of restrictions
§ Insurance and bonding of members
§ Provide for maintenance, utility, gardening, etc.
§ Purchase of equipments, supplies, etc for common areas
§ Payment of taxes, assessments and discharge encumbrances
§ Reconstruction and repairs of common areas
§ Delegation of its powers
§ For allowed entry into any unit for maintenance, etc
§ For power of attorney in its favor from members
§ To amend restrictions by a majority vote of members
§ For reasonable assessments to meet expenditures
§ For partition, dissolution and/or sale of condominium as authorized by law of the courts
§ Others as authorized by secondary purposes of articles and by-law.
§ Buy and sell independent units in exercise of rights of first refusal
§ Otherwise lease such units for the corporation’s benefit
§ Assume mortgage on independent units
§ Establish service cooperatives among the unit-owners
§ Other undertaking for benefit of the corporation and its members (shareholders or stockholders)
§ The boundary of the unit granted are the interior surfaces of the perimeter walls, floors, ceilings, windows and doors thereof
§ An exclusive casement (right to enjoy) for the use of the air space encompassed by the boundaries of the unit
§ The common areas are held in common by the holders of the units, in equal share one for each unit
§ A non-exclusive casement for ingress, egress, and support through the common areas in apartment to each unit and the common areas are subject to such casement
§ Exclusive right to renovate, remodel, redecorate or refinish the inner surfaces of the unit (walls, ceiling, floors, window and doors bounding the units), provided value is not impaired
§ Exclusive right to mortgage, pledge or encumber his unit and to have the same appraised independently of the other units of the condominium (subject to restriction in the Declaration of Restriction)
§ Absolute right to sell dispose of the condominium unit (subject to the right of first refusal) (Sec. 6, RA 4726)
§ A requirement in the master deed or declaration of restriction that the property be first offered to the condominium corporation or its management body within a reasonable period of time before the same is offered to outside parties
§ In a general sense, the Master Deed or Enabling Act states what acts the unit holders/owners can legally do. The Declaration of Restrictions specify the acts that cannot be legally done.
§ Three (3) years after damage or destruction, no rebuilding or repair has been made to a material part rendered unfit for use
§ More than ˝ of project rendered untenantable- owners of more than 30% interest in the common areas are opposed to repair
§ Project in excess of 50 years, obsolete an uneconomical to repair- owners holding over 50% interest in common areas opposed to repair
§ Project is condemned or expropriated, no longer viable- owners of 70% interest in common areas are opposed to the continuation after condemnation or expropriation of a material part of project
§ That conditions for such partition are set forth in the Declaration of Restrictions duly registered (Sec. 8, RA 4726)
§ Common areas owner or held by the condominium corporation are transferred pre-indivise by way of liquidation an in proportion to their interests to the members or stockholders subject to the superior rights of creditors. Such transfer is deemed all liquidation and the condominium corporation is deemed to sell the entire project for the benefit of all the owners.
§ When the Master Deed is revoked upon registration of an instrument executed by the condominium corporation and consented to by all the registered holders of any lien or encumbrance on the land or building
§ When the condominium corporation is dissolved through an action for dissolution filed by the affirmative vote of all stockholders or members at the general meeting called for the purpose provided all the requirements of section 62 of the Corporation Law are compiled with. (Sec. 13 and 14, RA 4726)
§ Condominium Corporation is deemed to hold a power of attorney to sell all separate interests of stockholders/member; and
§ Full liquidation of the Corporation by sale of entire project, again subject to the right of the Corporation itself and individual creditors
§ Condominium housing had its beginning in the 1920s in South America and in some parts of Europe, particularly in Spain, Italy, France and Great Britain because of critical space shortage and high construction cost.
§ In the US, condominium became a trend only in the early 1960s as a forerunner of the cooperatives. Cooperative housing evolved through the information of corporation with the shareholders entitled to occupied a unit. The cooperative however suffered from a crucial disadvantage in that the financial liability of a member who failed to pay his obligation became also the liability of the other members. Hence, the condominium supplanted the cooperative as a housing concept.
§ In the Philippines, the system of co-ownership as provided in the civil code (approved in June 18, 1949) was the closest concept to condominium before the latter became a definite development pattern.
§ Condominium here had its formal birth with the passage in June 18, 1966 by Congress of Republic Act No. 4627 entitled “An Act to Define Condominium.” This established the requirements for its creation and governs its incidence.
§ Initially, the construction of condominium was primarily to provide space for dwelling and/or office in urban centers where land cost was very high to enable those who could not afford to be located near their source of livelihood and children’s schooling.
§ Then, it found acceptance in Baguio City other summer retreats as an answer to the inconvenience of owning a house and lot which the owner uses only for about one week twice a year while being burdened with the year-round cost of maintenance and salary of caretaker.
§ Later, with the construction of luxurious high-rise condominium like the Avalon, Urdaneta, and Twin Towers, status symbol was attached to ownership of high-budget condominium units.
§ Condominium is an interest in real property consisting of an absolute ownership in a unit or a residential, office or commercial building, and an individual interest in the land and other common areas of the project.
§ Condominium unit is a part of the condominium project intended for a specific type of independent use of ownership, which is the space bounded by the interior surface of the perimeter walls, floor, ceiling and exterior windows and doors.
§ This refers to the site, the saleable units and the common areas.
§ In terms of evidence of ownership. The traditional concept is evidenced by a Transfer Certificate of Title (TCT), while condominium ownership is evidenced by a Condominium Certificate of Title (CCT).
§ In terms of property rights. The interest of an owner in the traditional concept generally consists of absolute ownership covering the land and the outer and inner structures of the building or the entire building.
§ In terms of capacity to buy. In the traditional concept, ownership is limited to Filipino individuals and corporations with at least sixty percent (60%) of the capital of which is owned by Filipinos. However, ownership by aliens not to exceed forty percent (40%) of the total units in a condominium project is legally allowed through the formation of a condominium corporation.
§ Absolute ownership of the air space in a particular unit bounded by the interior surfaces of the door, floor, walls, ceiling and windows
§ Co-ownership of the land and common areas such as the weight bearing columns, beams, floors and utilities and facilities
§ The transfer certificate of title covering the land is in the name of the condominium corporation of which a unit owner is a member.
§ The condominium title identifies the unit as part of the project annotated on the transfer certificate of title covering the land.
§ As to cost: low-budget or high-budget
§ As to construction: townhouses and high-rise condominium buildings
§ As to usage: residential, office or commercial
§ Enhances affordability by fractionalizing cost of land and building
§ Facilities and services cost less to build and maintain
§ Makes possible home ownership near commercial and industrial areas
§ Economy in land space: families holding title to a contiguous land of say 40.50 or 60sqm may obtain adequate housing by constructing a condominium project thereon.
§ Retention of the psychological and economic concept of a family house by exclusive ownership of a unit while holding co-ownership rights on the undivided common areas and facilities
§ Promotes closer neighbor ties because of homogeneity of economic level of owners
§ Round-the-clock maximum security service
§ Buyers prefer the additional features of the traditional single detached housing such as privacy in a detached home or availability of a large yard.
§ Condominium units and townhouses are not mere apartment-type or row houses in ribbon-type clusters along the street. The application of varying building types for each cluster and the use different facades have eliminated monotonous architectural repetition and enhanced visual appeal and aesthetic influence.
§ With gasoline cost and traffic snarls involving more expensive and man-hour wastage, the convenient proximity of condominium sites to one’s place of business or office is a distinct advantage.
§ Apartment dwellers whose monthly rental is more than P5,000.00
§ Businessmen from the province with children schooling in Metro Manila
§ Businessmen, professionals and senior executives who wish to provide housing benefits to a “special friend.”
§ Professionals and entrepreneurs who have acquired social and financial status
§ Businessmen from the provinces who, in their periodic stay in Metro Manila, are staying in plush hotels
§ Multi-national companies who desire housing for their top executives
§ Foreign embassies
§ Busy professional and executives, as well as the elderly who are constrained by the “hustle and bustle” of city living prefer homeownership which is free from the burdensome exterior maintenance chores associated with detached houses
§ People who buy for investment or for rental income
§ Foreigners desiring residential ownership but who are disqualified under the traditional concept of ownership
§ Parents whose house has become too big for them because of the marriage of their children who have established own separate residences
§ Exclusive ownership of the dwelling/ office/ commercial section bounded by the interior surfaces of the perimeter walls, floors, ceilings and exterior windows and doors
§ Co-ownership of the land and common areas of the project
§ Non-exclusive easement, enjoyment of ingress to and egress from the roads, streets, alleys, utilities, facilities and amenities
§ Right to sell, transfer, lease or otherwise dispose of the unit subject to the right of first refusal by the condominium corporation
§ Right to mortgage, pledge or encumber the unit and to have the same appraised independently of the other units
§ Voting right in the election of directors and participation in other affairs of the corporation
§ To pay assessment and other fees as may be prescribed by the condominium corporation
§ To comply with use restriction
§ To pay the real estate tax on the unit
§ To pay the insurance for the unit
§ To promote the recreation, health, safety and welfare of the residents (janitor, security, garbage collection)
§ To pay for water and electric bill on the common areas
§ To pay for the realty tax and insurance on the common areas
§ For improvement and maintenance of common areas
§ To fund property management services expenses such as salaries, supplies, etc.
§ The organization of a condominium corporation is a legal requirement, especially if some unit buyers are foreigners, in order that title to the land may registered in the name of the corporation with all unit owners as members. Its primary purpose is ownership of the common areas and management of the project.
§ Membership in the corporation is co-terminous with unit ownership. When a member ceases to own a unit, he automatically ceases to be a member of the corporation.
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