CONDOMINIUM ACT

1. What is a condominium?
• A condominium, according to the law, is an “interest in a real property
consisting of a separate interest in a unit in a residential, industrial, or
commercial building and an undivided interest in common, directly or
indirectly, in the land in which it is located and in other common areas of the
building.”
• In other words, a condominium is a building where sections of which can be
owned individually by a person or, in some cases, a corporation. This can be
for either a residential, industrial, or commercial purpose.
• 2. Who can own condominiums?
• Filipino citizens and corporations can own
condominiums. Foreigners, however, are restricted to owning
no more than 40 percent of the total and outstanding capital
stock of a corporation, which must be Filipino-owned and
controlled. In addition to that restriction, foreigners and
foreign corporations are, by law, prohibited to own land.
3. Who can own condominium units?
Again, Filipino citizens and corporations can own condominium units. This
time, however, foreigners, by virtue of the Condominium Act, are allowed
to purchase and acquire condominium units.
4. What is my stake in a condominium?
As a unit owner, you are, in essence, a co-owner of the condominium,
entitled to such privileges and limited by such restrictions that may follow
the title.
5. What forms part of a condominium unit?
Everything within the boundaries of your unit forms part of the same. According to the
law, the interior surfaces of the perimeter walls, floors, ceilings, windows, and doors
form the boundary of your unit. That is, of course, unless the master deed or the
declaration of restrictions prescribed by the condominium corporation or the
administration stipulate otherwise.
6. Am I allowed to alter anything beyond the boundaries of my unit?
Generally, no. However, if the administration allows such alteration or does not prohibit
the same, then you may be allowed to. A thorough read of the house rules or the
contract would be a good idea.
7. What does not form part of the condominium unit?
In most cases, areas that are not found inside the unit are deemed to be
excluded from the unit but the condominium law itself lists aspects of
properties that generally do not form part of the unit. To wit: “bearing walls,
columns, floors, roofs, foundations, and other common structural elements
(e.g., lobbies, stairways, hallways, and other common areas), elevator
equipment and shafts, central heating, central refrigeration, and central air-
conditioning equipment, reservoirs, tanks, pumps, and other central services
and facilities, pipes, ducts, flutes, chutes, conduits, wires, and other utility
installations, wherever located.” An exception to the list are those outlets that
are located within the unit.
8. Can I freely sell my unit?
Yes. That is not prohibited in the condominium law. When
you sell your unit, however, you are not just selling the unit
itself, you are also selling your interest in the common
areas, as well as your membership and shareholdings in the
condominium corporation.
9. Can I freely sell my condominium?
Not exactly. Selling a unit may be simple, but selling a condominium is restricted by
certain rules under the Condominium Act. One of such restrictions is the ownership
requirement. For condominiums where the common areas are co-owned by the
owners of the units, the law requires that the purchaser be either a Filipino citizen or
corporation—a corporation that is at least 60 percent owned and controlled by
Filipinos. For condominiums owned by corporations, the sale will be deemed invalid if
such a sale would result in the foreign interest in the corporation exceeding the limits
prescribed by law, which in this case, is 40 percent. In other words, in both cases, the
foreign ownership in the purchasing corporation cannot exceed 40 percent,
otherwise, the sale would be invalid.
10. Can I mortgage my unit for a loan?
Yes. The condominium law states that “each condominium
owner shall have the exclusive right to mortgage, pledge, or
encumber his condominium and to have the same
appraised independently of the other condominium owner
is personal to him.”
11. Can the condominium corporation sell the condominium without my
consent?
As a general rule, it can. However, if the master deed contains a requirement
that the property should first be offered to the other condominium owners
within a reasonable time before offering it to third parties, then it may not.
Another restriction, however, is one that has been amended to the Corporation
Code by Republic Act No. 7899, which states that, as an owner, you shall not sell,
exchange, lease, or otherwise dispose of the common areas of a condominium
without the approval of the simple majority of the registered owners, subject as
well, to the approval of the Housing and Land Use Regulatory Board (HLURB).
12. The Condominium Act stipulates that the owners can sell the condominium
after 50 years. Does that mean that I will not have any say in the sale?
No, that is not the case. Upon turnover of the unit to you, you become a
member of the corporation that owns the condominium. Hence, your
concurrence or dissent on the matter will count. If, however, it has been decided
that the building shall be sold, then you will be compensated for your
appropriate share from the proceeds of the sale.
13. Who owns the common areas in a condominium?
Generally, titles to the common areas are held by a corporation formed for the
purpose. However, the condominium law also states that the common areas are
held in common by the unitholders, in equal share for each unit.
14. What are my rights as a condominium unit owner?
Aside from those already mentioned, the only other right you have as a unit owner is the right to renovate
your unit, for as long as all renovations are done within the boundaries of your unit. All restrictions on your
rights and activities are those that are stipulated in the declaration of restrictions or on the contract you
signed upon the turnover of the unit to you.
15. I own a condominium building, and I want to amend or revoke the master deed. May I do so without
reservation?
No. The Condominium Act states that you can only do this upon the registration of an instrument (a formal
legal document) executed by a simple majority of the registered owners of the property. In this case, a
simple majority could mean either of the two: a majority based on per-unit ownership or a majority based
on the floor area of ownership.
For condominiums used for either residential or commercial purposes, the former would apply, while if it is
for a mix of both purposes, it is the latter. This requirement also stipulates that the registered owners must
be notified in advance. Evidence of a vote of a simple majority must also be submitted to the HLURB.