Among its various functions, the most important is its mandate to implement Presidential Decree (PD) 957 also known as the Subdivision and Condominium Buyers’ Protective Decree (Note: The law itself is too long and complicated; you are best advised to read it if you have lots of free time).
Suffice it to say that this law seeks to closely supervise and regulate the real estate subdivision and condominium businesses and to impose penalties on fraudulent practices and manipulations committed by real estate developers and dealers, including their sales personnel.
Such fraudulent practices and manipulations by developers have included the following:
1. Failure to properly maintain subdivision roads, drainage, sewerage, water systems and other similar basic requirements that may become detrimental to the health and safety of home and lot buyers.
2. Failure to deliver titles to the buyers
3. Failure to deliver titles to the buyers free from liens and encumbrances
4. Failure to pay real estate tax
5. Fraudulent sales of the same subdivision lot to different innocent buyers; and more.
6. No Certificate of Registration (CR) and License to Sell (LS)
7. Incomplete development
Before any real estate project can be sold to the public, the developer is required to secure a Certificate of Registration (CR) and a License to Sell (LTS) from the HLURB. Issuance of said documents requires the developer to submit several other documents which are meant to prove, among others, that:
1. The owner or real estate developer is reputable
2. The business is financially stable
3. The proposed sale of the subdivision lots or condominium units to the public would not be fraudulent
The above discussion on the function of HLURB is by no means complete. It is only meant to emphasize the importance of buying only from a developer whose project has been issued a Certificate of Registration and a License to Sell. Though not an absolute guarantee (they can be revoked by the HLURB), the CR and LTS are meant to ensure that you buy into a project that will be delivered to you problem-free.
For your guidance, here’s a link to real estate projects in Metro Manila which have been issued cease and desist order by the HLURB. Lack of Certificate of Registration and License to Sell are the most oft-repeated reasons for the cease and desist order.
In other regions, the reasons cited for the issuance of the cease and desist order vary from "incomplete development,” "foreclosed by mortgagee bank," "unauthorized alteration in the development plan,” " failure to post performance bond,” "poor health of the owner/developer,” etal.
The following lists down by regions projects that have also been issued cease and desist order by the HLURB:
Region 7 and 8
Prospective home buyers are always advised to conduct their own due diligence before committing to any property. This is one important step that you can do at the comfort of your home. Do note, however, that even HURB admits that this database is not always updated. Thus, if you find a project in the list, you must double check with the HLURB.
Author: Cecilio A. Sanchez, Jr. (Licensed Real Estate Broker)