Condominium Redevelopment Act

Senate Office of the decretary TWENTIETH CONGRESS OF THE REPUBLIC OF THE PHILIPPINES 25 OCT -6 P3:15 First Regular Session SENATE RECEIVED BY: S. No. 1442 Introduced by Senator JV Ejercito AN ACT AMENDING REPUBLIC ACT NO. 4726 OTHERWISE KNOWN AS "THE CONDOMINIUM ACT" EXPLANATORY NOTE In 2024, there was a significant surge in the supply of condominiums in Metro Manila, especially in areas such as Pasay City and Parañaque City. This overflow in the condominium market raises concerns for developers, showing 77% of units remained unsold in 2024 to 158 billion pesos inventory. These vacant units would take 8.2 years to be completely sold. Despite a delicate sales increase of 14% in the residential condominium market at the onset of 2025, the improvement was projected as temporary due to the recent economic mayhem in the global economy.3 Aside from the current status of the condominium market in the Philippines, potential residents ponder on various factors in renting or buying condo units — the location and accessibility, its alignment with their long-term goals, and whether to 1 Reyes, J. de los. (2025). Metro Manila condo market remains resilient, adaptable. INQUIRER.net. business.inquirer.net/509928/metro-manila-condo-market-remains-resilient-adaptable 2 Jose, A. E. O. (2025, February 6). Metro Manila condo oversupply worsens, with 8.2-year market absorption time - colliers. BusinessWorld Online. bworldonline.com/corporate/2025/02/06/651623/metro-manila- condo-oversupply-worsens-with-8-2-year-market-absorption-time-colliers/ 3 Loyola, J. A. (2025, April 8). Metro Manila's real estate puzzle: Oversupply, opportunity, and Recovery - Manila Bulletin. Manila Bulletin. mb.com.ph/8/4/2025/metro-manila-condo-market-shows-recovery-but-geo- economics-may-temper-growth

purchase it for residence or as an investment property. A condominium unit is a dream come true for some owners, a place they come home to. It is only proper to guarantee them a quality experience, assisting them to adjust, live, and settle, temporarily or for good. The Republic Act No. 4726, known as "The Condominium Act," provides the legal frameworks that guide developers and unit owners. With the status quo in the condominium market and modern considerations of potential buyers, amendments are introduced to cater to these timely needs. This bill involves comprehensive voting requirements for the voluntary dissolution of condominium corporations. It also strengthens representation among unit owners in decision-making, ensuring that these entities are duly authorized. In pursuit of providing an equitable living experience to condominium residents, this measure also provides specific provisions for the maintenance of units and facilities and allows unit owners to receive their allotment from the income generated from leasing common areas. This proposed bill seeks to amend the Condominium Act to provide quality living conditions to residents and guide developers in managing their establishments, further addressing the present issues and needs of both parties. In view of the foregoing, the immediate passage of this measure is earnestly sought. JV EJERCITO 4 Soriano, J. (2024, December 15). Thinking of buying a condo unit in 2025? some things to consider. GMA News Online. https://www.gmanetwork.com/news/money/personalfinance/930054/thinking-of-buying-a-condo- unit-in-2025-some-things-to-consider/story/

Senate Office of the ferretarp TWENTIETH CONGRESS OF THE REPUBLIC OF THE PHILIPPINES First Regular Session ) OCT -6 P3:15 SENATE RECEIVED BY: S. No. 1442 Introduced by Senator IV Ejercito AN ACT AMENDING REPUBLIC ACT NO. 4726 OTHERWISE KNOWN AS "THE CONDOMINIUM ACT" Be it enacted by the Senate and the House of Representatives of the Philippines in Congress assembled:

Section 1. Short Title. - This Act shall be known as the "Condominium

2 Redevelopment Act".

Sec. 2. Declaration of Policy. - It is hereby declared the policy of the State to

4 establish livable communities to provide equitable, inclusive, and resilient 5 opportunities for the improvement of human well-being while contributing to the 6 economic vitality of the community. It is likewise the policy of the State to ensure the safety and integrity of existing 8 condominium developments in order to protect the public against hazards of aged buildings that pose threats to the protection of owners and the general public. Towards this end, the State shall establish rules for the proper construction, 11 maintenance, repair, reconstruction and redevelopment of condominium projects, ensuring that the property rights of unit owners are respected while addressing the needs of the community and improving the overall quality of life of Filipinos.

Sec. 3. Scope. - This Act shall cover all condominium projects as defined in

Republic Act No. 4726 which are now in existence or which may be constructed hereinafter.

Sec. 4. Scope. - Section 4, last paragraph, of RA 4726 is hereby amended to

read as follows: "Section 4. xxx "The enabling or master deed may be amended or revoked THROUGH A SPECIAL POWER GRANTED BY THE REGISTERED OWNERS, OR upon registration of an instrument executed by a simple majority of the registered owners of the property: Provided, That in a condominium project [exclusively] for [either] residential, [or] commercial, OR MIXED use, simple majority shall be on a per unit of ownership basis, OR [and that in the case of mixed use, simple majority shall bel on a floor area of ownership basis, AS DETERMINED IN THE MASTER DEED: Provided, further, That prior notifications to all registered owners are done: and Provided, finally. That any amendment or revocation already decided by a simple majority of all registered owners shall be submitted to the [Housing and Land Use Regulatory Board] DEPARTMENT OF HUMAN SETTLEMENTS AND URBAN DEVELOPMENT and the city/municipal engineer for approval before it can be registered. Until registration of a revocation, the provisions of this Act shall continue to apply to such property."

Sec. 5. Section 5 of RA 4726 is hereby amended to read as follows:

"Section 5. "Any transfer or conveyance of a unit or an apartment, office or store or other space therein, shall include the transfer or conveyance of the undivided interests in the common areas or, in a proper case, the membership or shareholdings in the condominium corporation: Provided, however. That where the common areas in the condominium project are owned by the owners of separate units as co-owners thereof, no condominium unit therein shall be conveyed or transferred to persons other than Filipino citizens, or corporations at least sixty percent of the capital stock of which belong to Filipino citizens, except in cases of hereditary succession. Where the common areas in a condominium project are held by a corporation, no transfer

or conveyance of a unit shall be valid if the concomitant transfer of the appurtenant membership or stockholding in the corporation will cause the alien interest in such corporation to exceed the limits imposed by existing laws. ANY TRANSFER OR CONVEYANCE OF THE COMMON AREAS (I) TO THE CONDOMINIUM CORPORATION OR CO-OWNERS AND (II) TO THE BUYER OF ALL UNITS OF THE PROJECT ON ACCOUNT OF SALE TRANSACTION PRECEDING A REDEVELOPMENT, SHALL BE EXEMPT FROM ALL NATIONAL AND LOCAL TAXES, INCLUDING INCOME TAX, CAPITAL GAINS TAX, VALUE ADDED TAX, AND LOCAL TRANSFER TAX."

Sec. 6. Section 6(a) of RA 4726 is hereby amended to read as follows:

"Section 6. Unless otherwise expressly provided in the enabling or master deed or the declaration of restrictions, the incidents of a condominium granted are as follows: (a) The boundary of a unit granted are the interior surfaces of the perimeter walls, floors, ceilings, windows and doors thereof, xxx UNIT AREAS WRITTEN ON ALL CONDOMINIUM CERTIFICATES OF TITLE SHALL BE DEEMED TO BE PRECEDED BY "APPROXIMATELY" AND FOLLOWED BY "SQUARE METERS, MORE OR LESS."

Sec. 7. Section 9 paragraph (a), of RA 4726 is hereby amended to read as

follows: "Section 9. xxx XXX XXX Such declaration of restrictions, among other things, may also provide: (a) As to any such management body: XXX XXX XXX (8) For entry by its officers, [and] THE DEVELOPER, THEIR agents AND REPRESENTATIVES into any unit DURING EMERGENCY SITUATIONS WHERE THERE IS DANGER OF DAMAGE TO LIFE OR PROPERTY, when necessary in connection with the maintenance or construction for which such body is responsible, OR FOR

MAINTENANCE AND REPAIRS RELATIVE TO COMMON AREAS AND OTHER CONDOMINIUM UNITS ARE CONCERNED, AND THE MANAGEMENT BODY AND/OR DEVELOPER AND THEIR RESPECTIVE AUTHORIZED REPRESENTATIVES SHALL NOT, BY REASON THEREOF, BE LIABLE FOR TRESPASS FOR SUCH ENTRY. IN THE EVENT ENTRY IS NOT GRANTED DESPITE REASONABLE NOTICE GIVEN THE PREVAILING CIRCUMSTANCES, SUCH CONDOMINIUM UNIT OWNER SHALL BE DEEMED AS HAVING ACTED IN BAD FAITH AND SHALL BE RESPONSIBLE FOR ALL DAMAGES WHICH MAY BE REASONABLY ATTRIBUTED TO NOT HAVING ALLOWED ENTRY FOR THE PREVENTION OF DAMAGE OR PERFORMANCE OF MAINTENANCE, CONSTRUCTION AND REPAIR WORKS."

Sec. 8. Section 10 of RA 4726 is hereby amended to read as follows:

"Section 10. Whenever the common areas in a condominium project are USED [held] by a condominium corporation, such corporation shall constitute the management body of the project. The corporate purposes of such a corporation shall be limited to the holding of the common areas, either in ownership or any other interest in real property recognized by law, to the management of the project, and to such other purposes as may be necessary, incidental or convenient to the accomplishment of said purposes. CONDOMINIUM DUES BASED ON THE ACTUAL USE, ACCESS AND ENJOYMENT BY THE MEMBERSHIP OR STOCKHOLDING OF THE COMMON AREAS OF THE PROJECT, WHETHER WHOLLY OR PARTIALLY, MAY BE ASSESSED BY THE CONDOMINIUM CORPORATION UPON INCORPORATION FOR MAINTENANCE OF THE COMMON AREAS. The articles of incorporation or by-laws of the corporation shall not contain any provision contrary to or inconsistent with the provisions of this Act, the enabling or master deed, or the declaration of restrictions of the project. UNLESS PROVIDED OTHERWISE IN THE BY-

LAWS, QUORUM FOR MEETING PURPOSES SHALL BE DETERMINED BY THE SIMPLE MAJORITY OF THE TOTAL CONDOMINIUM UNITS HELD BY MEMBERS IN GOOD STANDING. Membership in a condominium corporation, regardless of whether it is a stock or non-stock corporation, shall not be transferable separately from the condominium unit of which it is an appurtenance. When a member or stockholder ceases to own a unit in the project in which the condominium corporation owns or holds the common areas, he shall automatically cease to be a member or stockholder of the condominium corporation. UNLESS PROVIDED OTHERWISE IN THE ARTICLES OF INCORPORATION AND BY LAWS, JURIDICAL UNIT OWNERS MAY NAME, CONSTITUTE AND APPOINT AN ATTORNEY-IN-FACT WHO SHALL REPRESENT THE SAME IN THE CONDOMINIUM CORPORATION AND WHO MAY LIKEWISE RUN FOR AND BE ELECTED AND APPOINTED TO THE BOARD OR ANY OFFICERSHIP POSITION; PROVIDED THAT SUCH ATTORNEY- IN-FACT WILL NOT CAUSE THE ALIEN INTEREST IN SUCH CORPORATION TO EXCEED THE LIMITS IMPOSED BY EXISTING LAWS."

Sec. 9. Section 13, paragraph (d) of RA 4726 is hereby amended to read as

follows: "Section 13. Until the enabling or the master deed of the project in which the condominium corporation owns or holds the common area is revoked, the corporation shall not be voluntarily dissolved through an action for dissolution under Rule 104 of the Rules of Court except upon a showing: XXX XXX XXX d. That the project or a material part thereof has been condemned or expropriated and that the project is no longer viable, [or that the members holding in aggregate more than seventy percent interest in the corporation, if non stock, or the stockholders representing more

than seventy percent of the capital stock entitled to vote, if a stock corporation,] OR THAT THE CONDOMINIUM OWNERS, BY A VOTE OF A MAJORITY (50% PLUS 1) OF THE STOCKHOLDERS OR MEMBERS THEREOF AT A GENERAL OR SPECIAL MEETING DULY CALLED FOR THE PURPOSE, are opposed to continuation of the condominium regime after expropriation or condemnation of a material portion thereof; or"

Sec. 10. Section 14 of RA 4726 is hereby amended to read as follows:

"Section 14. The condominium corporation may also be dissolved [by the affirmative vote of all the stockholders or members thereof at a general or special meeting duly called for the purpose: Provided, That all the requirements of Section sixty two of the Corporation Law are complica with.] IN THE FOLLOWING MANNER: (a) IF THE PROJECT HAS BEEN IN EXISTENCE FOR THIRTY (30) YEARS OR MORE BUT LESS THAN FIFTY (50) YEARS, BY THE AFFIRMATIVE VOTE OF 2/3 OF THE STOCKHOLDERS OR MEMBERS THEREOF AT A GENERAL OR SPECIAL MEETING DULY CALLED FOR THE PURPOSE: PROVIDED, THAT ALL THE REQUIREMENTS OF TITLE XIV OF THE REVISED CORPORATION CODE OF THE PHILIPPINES ARE COMPLIED WITH; AND (b) IF THE PROJECT HAS BEEN IN EXISTENCE FOR FIFTY (50) YEARS AND ABOVE, BY THE AFFIRMATIVE VOTE OF A SIMPLE MAJORITY OF THE STOCKHOLDERS OR MEMBERS THEREOF AT A GENERAL OR SPECIAL MEETING DULY CALLED FOR THE PURPOSE: PROVIDED, THAT ALL THE REQUIREMENTS OF TITLE XIV OF THE REVISED CORPORATION CODE OF THE PHILIPPINES. FOR PURPOSES OF THIS SECTION, THE VOTES OF EACH UNIT OWNER SHALL BE DETERMINED AND IN ACCORDANCE WITH THE LAST PARAGRAPH OF SECTION 4 ABOVE."

Sec. 11. Section 15 of RA 4726 is hereby amended to read as follows:

"Section. 15. Unless otherwise provided for in the declaration of restrictions upon voluntary dissolution of a condominium corporation in accordance with the provisions of Sections thirteen and fourteen of this Act, the corporation shall be deemed to hold a power of attorney from all the members or stockholders to sell and dispose of their separate interests in the project and liquidation of the corporation shall be effected by a sale of the entire project as if the corporation owned the whole thereof, subject to the rights of the corporate and of individual condominium creditors. A MEMBER OR STOCKHOLDER SHALL BE ENTITLED TO AN ADVANCED PAYMENT OF HIS OR HER PRO RATA SHARE FROM THE PROCEEDS OF THE SALE OF THE ENTIRE PROJECT BASED ON AN AGREED VALUATION BETWEEN THE CONDOMINIUM CORPORATION AND THE BUYER OF THE PROJECT. SUCH ADVANCED PAYMENT SHALL BE DEDUCTED FROM THE FINAL AMOUNT TO BE PAID TO THE MEMBER OR STOCKHOLDER."

Sec. 12. Section 16 of RA 4726 is hereby amended to read as follows:

"Section 16. A condominium corporation shall not, during its existence, sell, exchange, [lease,] or otherwise dispose of the common areas owned or held by it in the condominium project unless authorized by the affirmative vote of a simple majority of the registered owners: Provided, That prior notifications to all registered owners are done: and Provided, further, That the condominium corporation may expand or integrate the project with another upon the affirmative vote of a simple majority of the registered owners, subject only to the final approval of the [Housing and Land Use Regulatory Board] DEPARTMENT OF HUMAN SETTLEMENTS AND URBAN DEVELOPMENT. THE CONDOMINIUM CORPORATION MAY LEASE A PORTION OF THE COMMON AREAS OWNED OR HELD BY IT IN THE CONDOMINIUM PROJECT PROVIDED THAT SUCH DOES NOT INTERFERE WITH THE OPERATIONS AND SAFETY OF THE COMMUNITY AS WELL AS WITH THE USE

THEREOF BY THE UNIT OWNERS, AND ALL NET RENTAL INCOME THEREOF INURE TO THE BENEFIT OF THE MEMBERS OR STOCKHOLDERS, AS THE CASE MAY BE."

Sec. 13. Section 18 of RA 4726 is hereby amended to read as follows:

"Section 18. Upon registration of an instrument conveying a condominium, the Register of Deeds shall, upon payment of the proper fees, enter [and annotate] the conveyance [on the certificate of title covering the land included within the project] and the transferee shall be entitled to the issuance of a "condominium owner's" copy [of the pertinent portion of such certificate of title]. Said "condominium owner's" copy need not reproduce the ownership status or series of transactions in force or annotated with respect to other condominiums in the project. A copy of the description of the land, a brief description of the condominium conveyed, name and personal circumstances of the condominium owner would be sufficient for purposes of the "condominium owner's" copy of the certificate of title. No conveyance of condominiums or part thereof, subsequent to the original conveyance thereof from the owner of the project, shall be registered unless accompanied by a certificate of the management body of the project that such conveyance is in accordance with the provisions of the declaration of restrictions of such project AND THERE ARE NO OUTSTANDING CONDOMINIUM DUES OR AREARS OWED FROM SUCH UNIT. In cases of condominium projects registered under the provisions of the Spanish Mortgage Law or Act 3344, as amended, the registration of the deed of conveyance of a condominium shall be sufficient if the Register of Deeds shall keep the original or signed copy thereof, together with the certificate of the management body of the project, and return a copy of the deed of conveyance to the condominium owner duly acknowledge and stamped by the Register of Deeds in the same manner as in the case of registration of conveyances of real property under said laws.

Sec. 14. Implementing Rules and Regulations. - The Human Settlements

2 Adjudication Commission shall promulgate within six (6) months from the effectivity 3 of this Act the implementing rules and regulations.

Sec. 15. Repealing Clause - All laws, decrees, orders, rules and regulations or

5 other issuances or parts thereof inconsistent with the provisions of this Act are hereby 6 repealed or modified accordingly.

Sec. 16. Separability Clause - If any portion or provision of this Act is declared

8 unconstitutional, the remainder of this Act or any provision not affected thereby shall 9 remain in force and effect.

Sec. 17. Effectivity. - This Act shall take effect immediately after its publication

in the Official Gazette or in a newspaper of general circulation. Approved,