How to Know if Condominiums are Perpetual or Leasehold in the Philippines?

I am writing this article right now with a gritting teeth and a lot of angst because at this moment of confusion and also anxiety- I am just currently dealing with this problem too.

 

See I am buying this condominium here in Metro Manila and they advertised the condo as FREE PARKING and PERPETUAL OWNERSHIP!

But the problems started going with the free parking; when they advertised it before as free, everybody was so hyped up. But when the time for turn over is nigh- Lo and Behold- they said that it was not written so they can’t provide it as free! F*cked isn’t it? But that’s the reality of believing marketers and advertisers (bunch of lying and deceiving people ya know- but I am not saying generally for ALL.)

Anyways, we brushed of thinking “huh? kinda makes sense coz they have to make money”. So I guess, me being understanding plus I do not drive too often here in the Philippines, I said what the heck and just let go of it.

But the fact is I got duped of that “not-written-didn’t-happen” crap. And know, I am experiencing Deja-Vu with the contract (Contract to Sell- CTS) and its Master Deed (MD).

When we reviewed the contract, it didn’t say perpetual nor did it say leasehold. On the master deed, it neither says that the unit was perpetual nor does it say too that it is leasehold. But instead, it says that the owner has the EXCLUSIVE OWNERSHIP of the unit- But does that actually say it is perpetual?

 

PERPETUAL IS IT?

Well, the thing is- based from my research, PERPETUAL or FREEHOLD Condominiums are condos which settles in a land OWNED by the developer and not leased from other entities i.e. corporations or agencies.

You also have an exclusive right to your own unit (with the exception of common areas) and you could pass it on to your kin because you will be given a Condominium Certificate of Title (just like a title of a house but for unit only) or also known as CCT. So technically, the developer/marketers/property management is saying that it is quite PERPETUAL, if in turn after 50 years the condo is still standing or in good condition.

 

But here is where the problem starts…

 

No clause or Term was seen in the Master Deed let alone the CTS or Contract to Sell (which it should if it really is PERPETUAL). I was then advised that this was “standard” and they do not see the need to reiterate it or so…

Well, within our minds we wanted to protest (violently at that time) to the developer but we, as a civilized people, requested in writing that  the term perpetual be indicated in the Master Deed and (not “or” anymore) in the CTS. This is why I have trust issues with marketers and advertisers and fellow filipino people.

If they will revise and put it there, then GOOD; we will proceed further for the purchase.

But if not, and they will play hookie with us by just going around the same “standard” term- then we will have them refund ALL of the downpayment due to their incapacity to provide proper service.

 

Safety and Assurance:

Well, if we were duped before then it could happen again. So for assurance we wanted it termed perpetual if it really is perpetual. The condominium act needs to be revised on this because that messed up law only implies things not actually putting any detailed term or absolute terminology.

Our agent (marketer) said that our condo to be acquired is perpetual even though it does not say in the MD or CTS and can you believe that he actually said those? He said that the whole reason why we will be given a CCT or Certificate of Condominium Title is because it is perpetual plus the developer owns the place. Well, here is my dime for that… in the MD or CTS they did not indicate perpetual; meaning they could change the term and extent too if the developer or property management felt that EVIL urge to change it. But see, you could also get a CCT for a leasehold condo… and by that time you receive it, it is already too late because you have signed all the papers and initial contracts i.e. CTS.

Conclusion

In conclusion, the reason why we want it to be on the legal document as for perpetual ownership is concerned is due to the fact that we were duped from the Free Parking Scheme. And now, we will not shoot our foot and say “Hey! we believe you!”

I call Shenanigans for that kind of stuff. If trust is the basis of business then here in the Philippines, you better make sure that you could trust them.

**** Lessons to be Learned***

  1. Never Assume anything in the Philippines (EVER!!!) if it is not written in legal documentations.
  2. Never trust verbal advertisements, they are always used only to hook people up.
  3. The broker / advertiser / marketer is not your FRIEND, never will, never does, never did.
  4. Secure the Master Deed and CTS for Condos with at least an actual term PERPETUAL.

 

Condo life in the Philippines.

-adminj

adminjay

"Jay Penn" is a Financial Literacy Mentor and Investor who is best known for his Book "Polymath's Profit". He is also an expert in the field of Maritime, Engineering, and Emergency Medical from his past careers. Experienced with Security Analysis, Crisis Prevention, Contingency Planning, and Global Maritime Distress Safety System. Currently instructs Nautical Sciences and is an avid Researcher of Business and Economics. He is also recognized as the "Top Maritime Instructor" for 3 consecutive years in the Maritime Education from 2014; raising the standard for the Maritime Industry and Training.

4 thoughts on “How to Know if Condominiums are Perpetual or Leasehold in the Philippines?

  • August 31, 2017 at 3:45 am
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    i am facing the same problem, did you get them to revise the MD in the end?

    Reply
    • August 31, 2017 at 10:45 am
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      Hi Silvia, *sigh Sad to say but NO, they didn’t revise the MD at all. When I demanded them to change it, they said that it was not written in the first place… so yeah “if it’s not written, it’s not applicable” is what they said. They have a point though, on this case; it is like winning the battle but losing the war. In the end, the legal department started throwing legal jargons why it is not credible if it is not in the master deed (talking about the parking). I have learned to document such things next time.

      Anyways, well it didn’t indicate perpetual but if a condo title was given which includes allotment of the land, then it is considered perpetual – there is NO perpetual term really in Master Deeds unless they also wanted to. Still, what we had is perpetual, but even if it is – condos are good for 50 years until they are assessed again for livable standards, if they are approved – then another 50 years is good, so on and so forth.

      Reply
  • December 30, 2017 at 5:56 pm
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    Interesting article and very informative. My thanks for posting this for all to be aware of.

    Reply

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