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Sec.

18 of RA 7279: UDHA - Balanced


Housing Development
&
Board Resolution No. 890, S. of 2012
Revised Implementing Rules

COMPLIANCE TO
Section 18,
RA 7279

Section 18 of Republic Act No. 7279


Balanced Housing Development
Board Resolution No. 890
Series of 2012

Revised Implementing Rules And Regulations


To Govern Section 18 Of Republic Act No. 7279,
Otherwise Known As The Urban Development
and Housing Act of 1992
Signed on: October 12, 2012
Published on: December 17, 2012
Effective on: January 1, 2013

Board
Resolution
No. 890, S. of
2012

Memorandum
Circulars
Nos. 01 05, S. of
2013

New
Whats
Whats
Whats
Features
Back
New
Out

1. Credits or charging of already existing


socialized housing projects / units as
compliance with Sec. 18
2.

Recomputation and reduction of the required


amount of compliance to an equivalent cost
for every housing unit.

Memorandum
Circulars
Nos. 01 05, S. of
2013

Board
Resolution
No. 890, S. of
2012

New
Whats
Features
Out

Required
Amount of
5,000
Compliance

P 5,000,000.00
P 150,000.00

Estimated Cost
Of Construction

\ SH Unit

P 5,000

P 166,666.66

3.33%

Board
Resolution
No. 890, S. of
2012

Memorandum
Circulars
Nos. 01 05, S. of
2013

Whats Back

Joint Venture with Other


Developers, but with more
safeguards, including the
requirement of accreditation
of developers of socialized
housing projects and NGOs;

Board
Resolution
No. 890, S. of
2012

Memorandum
Circulars
Nos. 01 05, S. of
2013

Whats New

1. Takeover Development and Rehabilitation of


Non-Performing Socialized Housing Assets
of the Housing Agencies;
2. Donation of land and introduction or
upgrading
of facilities, centers, amenities or other
forms of development to a CMP Project;
3. Purchase of Asset-Backed Securities
conveyed
by SHFC;

Memorandum
Circulars
Nos. 01 05, S. of
2013

Board
Resolution
No. 890, S. of
2012
More Options

New Features
More
Houses
More
Options

Strict implementation of the required


20% computation of the compliance
project.
Clearer rules and procedure on the
declaration, identification, and
annotation of the particular blocks and
lots units for more effective monitoring,
inspection and accounting and to prevent
re-utilization or duplication of
compliance.

Memorandum
Circulars
Nos. 01 05, S. of
2013

Board
Resolution
No. 890, S. of
2012
More Options

New Features
More
Houses
More
Options

Incorporation and integration of the


requirements of the Balanced Housing
Development in the entire procedure of
registration, licensing, monitoring and
regulation of subdivision projects as
required under P.D. No. 957, with similar
emphasis on public information through
new requirements in the notice of
publication and posting of billboards;

Memorandum
Circulars
Nos. 01 05, S. of
2013

Board
Resolution
No. 890, S. of
2012
More Options

New Features
More
Houses
More
Options

Implementation and use of new forms


to facilitate the registration and
licensing procedure and at the same
time to clearly identify the allotment
of specific house, lots or units utilized
as compliance
Introduction of clearance and reporting
New documentary
requirements
to
system
among the different
regional
prevent misrepresentation
or
offices
circumvention;
to ensure compliance
and completion of
the
projects anywhere in the Philippines;

Memorandum
Circulars
Nos. 01 05, S. of
2013

Board
Resolution
No. 890, S. of
2012
More Options

New Features
More
Houses
More
Options

Close
and regular monitoring
ofnew
compliance
Implementation
and
use
of
forms
Strict
implementation
of
the
required
projects
and
imposition
of stiffer penalties
to
facilitate
the
registration
and
20%
computation
of
the
compliance
including
suspension
of and
the at
license
to sell
licensing
procedure
the
same
project.
of
time to clearly identify
the allotment
Clearer
rules
and
procedure
on
theof
the
main
subdivision
projects
in
cases
of specific house, lots or units utilized
declaration,
identification,
and the
non-completion
of
violation involving
as or
compliance
annotation
ofofthe
particular
blocks
and
Introduction
clearance
and
reporting
compliance
project.
New
documentary
requirements
to
lots
units
for more
effective
monitoring,
system
among
the
different
regional
prevent
or
inspection
and misrepresentation
accounting
and to prevent
offices
circumvention;
re-utilization
or duplication
of
to ensure
compliance
and completion
of
compliance.
the
projects anywhere in the Philippines;

Board
Resolution
No. 890, S. of
2012

Memorandum
Circulars
Nos. 01 05, S. of
2013

New Features

Disallowance of registration and licensing of


new projects in case of incomplete or
unfinished compliance projects;

Memorandum
Circulars
Nos. 01 05, S. of
2013

Board
Resolution
No. 890, S. of
2012
More Options
More Options

Implementation
and use
of
new
forms
Modes
of Compliance
- New
modes
More
Strict
implementation
of the
required
to facilitate
registration
are 20%
provided
in thethe
Revised
notand
only to
computation
of
the IRR
compliance
procedure
and
at the same
givelicensing
more options
to the
developer
but to
project.
time topossibly
clearly identify
the allotment
explore
more innovative
and
of specific
house,
lots or units
utilized
responsive
ways
of housing
development
asthe
compliance
that may spur
production of more
housing units;

Memorandum
Circulars
Nos. 01 05, S. of
2013

Board
Resolution
No. 890, S. of
2012
More Options
More Options

Allowable Combination - Developers are allowed to


Disallowance
of registration
and
licensing
of
combine
and choose
among the
different
modes
of
new projects
in casethe
of incomplete
or project
compliance,
to complete
required 20%
unfinished compliance
projects;
cost.
Ease of Locating The Project - Developers are
New
documentary
requirements
to
allowed to
locate
the compliance
project anywhere
preventifmisrepresentation
in the Philippines
not feasible to be or
developed
circumvention;
within the same
city or municipality.

Memorandum
Circulars
Nos. 01 05, S. of
2013

Board
Resolution
No. 890, S. of
2012
More Options

More Options
Houses
More
More participants in the Balanced
Housing
Development Program, including
accredited
subsidiaries, affiliates, other
developers of
SHPs, NGOs, the housing agencies,
and LGUs;

Memorandum
Circulars
Nos. 01 05, S. of
2013

Board
Resolution
No. 890, S. of
2012
More Options

More Options
Houses
More
New responsibilities
and
More participants
in the Balanced
accountabilities
Housing
not
only on theProgram,
part of the
developers
Development
including
but
accredited
more
particularly
on HLURB
tasked to
subsidiaries,
affiliates,
other
implement, monitor,
and of
account for the
developers
actualNGOs,
number
socialized
housing
SHPs,
theof
housing
agencies,
units
and
LGUs;
produced vis--vis the total number of
main
subdivisions developed.

Memorandum
Circulars
Nos. 01 05, S. of
2013

Board
Resolution
No. 890, S. of
2012
More Houses

More Houses
New responsibilities and
accountabilities
not only on the part of the developers
but
more particularly
on HLURB
tasked
Section
18 of Republic
Act
No. to
implement, monitor, and account for the
7279
actual number of socialized housing
Balanced Housing
unitsDevelopment
produced vis--vis the total number of
main
subdivisions developed.

Section 18 of Republic Act No.


7279
Balanced Housing Development

REPUBLIC ACT 7279


Section 18. Balanced Housing
Development:
whereby developers of proposed
subdivision
projects
shall
be
required to develop an area for
socialized housing equivalent to at
least twenty percent (20%) of the
total subdivision area or total
subdivision project cost,. . .

COMPLIANCE:
1. Development of new settlement;
2. Slum upgrading or renewal of areas for priority
development either through zonal improvement
programs
or
slum
improvement
and
resettlement programs;
3. Joint-venture projects with either the local
government units or any of the housing
agencies; or
4. Participation in the community mortgage
program

DEFINITIONS

Project Area shall mean:


e.1 for subdivision projects without housing
component, the gross developed land area

e.2
for subdivision projects with housing
component:
e.2.1 gross developed land area and
e.2.2 aggregate floor area of all housing
units
e.3 for condominium projects, the gross floor
area of residential units.

Project Cost refers to cost of the project


based on the following:

raw land, based on the zonal value


at the time of application for
subdivision development permit
(ii) land development
(iii) housing component construction
(i)

Asset-Backed Securities certificates in


accordance with RA 9267 or the
Securitization Act of 2004, as originated
or sold by the Social Housing Finance
Corporation, to be repaid from the
proceeds of the outstanding mortgage loan
of CMP beneficiaries.

Community Mortgage Program (CMP)


refers
to a financing window or scheme that is
funded by the Government thru the Social
Housing Finance Corporation (SHFC) and
that provides long-term loans to a legallyorganized association and its qualified
members to acquire ownership or tenurial
security on the property and the land they
occupy.

Compliance Project- refers to the


socialized housing project, multi-level,
medium-rise housing project or
condominium project sold at the
prevailing price ceiling for socialized
housing, or other development utilized
to comply with the balanced housing
development required under Sect. 18 of
RA 7279.

Non-Performing Socialized Housing


Assets
refers to socialized housing units or
projects owned by the government
housing agencies needing rehabilitation
and restoration before they can be
made available for sale at the prevailing
price ceiling for socialized housing.

Sample Computation of 20% Compliance


Area based
Project area
Housing floor area
Total project area
Required compliance

Cost based

= 10,000 sqm
= 10,000sqm Project area
= 2,000sqm Housing floor area= 2,000 sqm
= 12,000sqm Rawland cost (500/sqm) = P5M
Land Devt cost (700/sqm)= P7M
= 20% x
12,000 Housing constn cost (8T/sqm)
=P16M
= 2,400sqm
Total project cost
= P28M
Required compliance
20% x 28M
= P5.6M

26

Development of New Settlement


Guidelines for Sect. 4.1 of Board Res. 890, s.2012

Manner of Compliance - developer of


main project shall develop a new
settlement with a cost equivalent to at
least twenty percent (20%) of the total
subdivision project cost of the main
project.

MODES OF COMPLIANCE
1. Joint venture project of the developer with an HLURB
accredited subsidiary or an HLURB-accredited developer
for the production of new socialized housing
projects;
2. Contribution of the developer in new socialized housing
projects of HLURB-accredited non-government
organizations (NGOs); or
3. The provision of educational facilities, health facilities,
productivity/ livelihood centers, and other basic amenities
and facilities in socialized housing projects.

Slum Upgrading

Guidelines for Sect. 4.2 of Board Res. 890, s. 2012

Manner of Compliance - the developer of


the main project may participate in various
programs and projects of the National
Housing Authority for slum upgrading or
renewal of areas for priority development
(APDs) thru zonal improvements, slum
improvement or resettlement programs with
costs equivalent to at least 20% of the total
project cost of the main subdivision project.

Modes of Compliance
1. Purchase of any instrument of
participation issued by NHA; or
2. Direct contribution to the various
programs and projects of NHA

Joint Venture with Either the Local Government Units


or any of the Housing Agencies
Guidelines for Sect. 4.3 of Board Res. 890, s. 2012

Manner of Compliance - the developer of


the main subdivision project may enter
into a joint venture (JV) with a local
government unit (LGU) or any of the
housing agencies wherein the developers
participation in or contribution to the JV
shall be equivalent to at least 20% of the
total subdivision project cost of the main
subdivision project.

Modes of Compliance
1. Development of a socialized housing project
or a housing project in a resettlement area;
2. Development and completion of a
socialized housing project which has been
taken over by HLURB pursuant to Sect. 35
of PD 957;
3. Rehabilitation of non-performing socialized
housing assets; or

4 . Provision of educational facilities, health


facilities, productivity/livelihood centers
and other basic amenities and facilities
mentioned in Sect. 21 of UDHA which
will benefit a socialized housing project;
or
5. Purchase of socialized housing bonds
issued by any of the housing agencies and
approved by HLURB.

Joint Venture with a Local Government


Unit
Development of SHP or a housing project in resettlement
area. The Joint Venture (JV) shall specify:
a. The amount of contribution of the
developer of the main subdivision project
to the JV;
b. The particular block and lot numbers or
unit numbers of the housing project being
allotted to the main project under the current
JVA.
c. The creation of a special bank account for the
JV.

The provision of educational facilities,


etc
The JV shall specify:
1. The amount of contribution of the
developer of the main subdivision project
to the JV;
2. The nature of the educational facilities,
health facilities, productivity/livelihood
centers or basic amenities and facilities to
be provided, the name and location of the
socialized housing project which will benefit
therefrom ; and
3. The creation of a special bank account for the JV.

Joint Venture with any of the Housing


Agencies
Development of a socialized housing project or
a housing project in a resettlement area. The JV
shall specify:
a. Amount of contribution of the developer
of the main subdivision project to the JV;
b. The particular block numbers and lot
numbers or unit numbers of the housing
project being allotted to the main project;
c. The creation of a special bank account for
the JV.

Joint Venture with any of the Housing


Agencies
Rehabilitation of non-performing socialized
housing assets. The JV shall specify:
a. The amount of contribution of the
developer of the main subdivision project
to the JV;
b. The nature, extent and cost of the work to
be done on the rehabilitation based on
the program of development and
c. Creation of a special bank account for the
JV.

Joint Venture with any of the Housing


Agencies

The provision of educational facilities,


etc

The JV shall specify:


1. The amount of contribution of the
developer of the main subdivision project
to the JV;
2. The nature of the educational facilities,
health facilities, productivity/livelihood
centers or basic amenities and facilities to
be provided, the name and location of the
socialized housing project which will benefit
therefrom ; and
3. The creation of a special bank account for the
JV.

Purchase of Socialized Housing


Bonds
The Certificate shall specify:
a. Total purchase price paid for
the
socialized housing bonds and
b. Terms and conditions and
undertakings
of the socialized housing
bonds.

Special Bank Account


The LGU or the housing agency shall
deposit all proceeds received under
Sections 6,7 and 8 hereof in a special
bank account established for that
purpose, except for the proceeds
received under Section 7.4 hereof
which may be deposited in the general
or other accounts of the housing
agency.

Participation in CMP

Guidelines for Sect. 4.4 of Board Res.


890, s. 2012
Manner of Compliance - the developer of the
main subdivision project shall participate in
or contribute to a CMP project , the cost
shall be equivalent to 20% of the total
subdivision project cost of the main
subdivision project.

Modes of Compliance
1. Providing a parcel of land to a CMP project;
2. Providing and developing a right-of-way or
access to roads or public transportation
lines to a CMP project or introducing or
upgrading of amenities, facilities or other
forms of development in an existing CMP
project; or
3. Subscription or purchase of asset-backed
securities originated or conveyed by the SHFC.

Board Resolution No.


ACCREDITATION
890
Series of 2012
Developers
Accreditation

ACCREDITATION

Memorandum
Circular No.
06,
Series of 2013

Guidelines For The


Accreditation of
Developers of
Developers
Accreditation
Socialized Housing
Projects

Memorandum
Circular No.
07,
Series of 2013

Guidelines For The


NGOs of NonAccreditation
Accreditation
Government
Organizations (NGOs)

ACCREDITATION

Developers
Accreditation

Qualifications &
Disqualifications
General Accreditation

Allows JV with any developers of main


subdivision
projects as compliance to Sec. 18
QUALIFICATIONS
1. Applicant must be engaged in the
development of socialized housing projects;
and
2. Applicant must have produced at least
2,000 SOCIALIZED HOUSING UNITS.

ACCREDITATION

Developers
Accreditation

Qualifications &
Disqualifications
General Accreditation

DISQUALIFICATION
S
1. Pending CDO
or suspension of license to
QUALIFICATIONS
sell imposed by any RFO on any of its
projects; and
2. Unpaid fees, fines or penalties imposed by
any RFO on any of its projects.

ACCREDITATION

Developers
Accreditation

Qualifications &
Disqualifications
Limited Accreditation

Allows JV DISQUALIFICATION
with any developers of main
developers of main subdivision
Allows JV with
subdivision
S to Sec. 18 ONLY under
projects as compliance
projects as compliance to Sec. 18
any of the ff. conditions:
1. If more than 50% of the voting stock of
the
is50%
owned
by voting
the developer
of the
stock ofof
2. Ifapplicant
more than
the
the
main subdivision
project;
applicant
and if more
than or
50% of the
voting
stock of the developer of the main
subdivision
project are owned by the same

Qualifications &
Limited Accreditation
Disqualifications

ACCREDITATION

Developers
Accreditation

+50
%

SH
Builder
s
Develop
er
Of SHPs

SH Limited Accreditation
Parent or Holding
MD1
MD2
MD3
MD4
MOTHERLAND
Company
Builde
Co.
DEVELOPMENT
rs

+50
%

MD 1
Homes

+50
%

+50
%

+50
%

MD2
Co.

MD3
Co.

MD4
Co.

Developers of Main Subdivision


Projects
subsidiar
y

ACCREDITATION

Developers
Accreditation

Qualifications &
Disqualifications
Limited Accreditation

Applicant need not possess the qualifications for


general accreditation but must not possess any of
the disqualifications.

ACCREDITATION

Developers
Accreditation

Qualifications &
Disqualifications
Limited Accreditation

HOWEVER,
the developers
ofthe
thequalifications
main subdivision
Applicant need
not possess
for
projectsaccreditation
with which applicant
entering
general
but must is
not
possessinto
anyJV
of
must have the following
qualifications, and none of
the disqualifications.
the disqualifications for general accreditation;
1. Must be engaged in the business of real
estate
development for at least five (5) years;
and
2. Must have produced at least 5,000 units.

ACCREDITATION

Developers
NGOs
Accreditation

Qualifications &
Disqualifications
Limited Accreditation

HOWEVER,
the developers
ofthe
thequalifications
main subdivision
Applicant need
not possess
for
projectsaccreditation
with which applicant
entering
general
but must is
not
possessinto
anyJV
of
must have the following
qualifications, and none of
the disqualifications.
the disqualifications for general accreditation;
1. Must be engaged in the business of real
1.
No pending CDO or suspension of license
estate
to
sell imposed
byatany
RFO
on(5)
any
of its
development
for
least
five
years;
projects; and
and
2. No unpaid fees, fines or penalties imposed
by any RFO on any of its projects.

ACCREDITATION

NGOs
Accreditation

Non-Government Organization
(1)Voluntarily organized under Phil. laws by
private citizens and without government
representatives among its directors and
officers; and
(2)Operating exclusively for non-commercial or
non-profit purposes.

ACCREDITATION

Qualifications

NGOs
Accreditation

1. It must be a non-stock corporation organized


under Phil. Laws;
2. It must be engaged in the development of
socialized housing projects or production of
socialized housing units or construction of
facilities, centers and other basic amenities and
facilities; and
3. It must have produced at least 500
SOCIALIZED HOUSING UNITS.

ACCREDITATION

Disqualifications

NGOs
Accreditation

1. Pending CDO or suspension of CR or LS;


and
2. Unpaid fees, fines or penalties.

ACCREDITATION

Issuance of
Certificate of
Accreditation

Documentary
Requirements
1. Sworn Application for Accreditation;
2. SEC Papers / Latest G.I.S.;
3. Latest audited financial & income
statements
4. Proof of completion of required no. of
units;
5. Certifications of no pending unpaid
fees,
fines or penalties; and
6. Copy of the official receipt.

ACCREDITATION

Issuance of
Certificate of
Accreditation

Documentary
Developers
Requirements
Additional
Accreditation
Requirements
for Limited
1. Specify namesAccreditation:
of the developers of the
main subdivision projects in the
application
form;true
andcopies of latest
2. Submit
certified
4. Proof of completion of required no. of
G.I.S.
units;
of
the developers of main subdivision
projects.

ACCREDITATION

Issuance of
Certificate of
Accreditation

Documentary
Developers
NGOs
Requirements
Additional
Accreditation
Accreditation
Requirements
for Limited
Accreditation:
Submission of its organizational
profile

ACCREDITATION

Procedure for
Accreditation

1. Submission of application to the RFO


where the
principal office of the applicant is
located; and
2. Forwarding of the application with all
the required documents and the RFOs
recommendation to the Office of the
CEO.

ACCREDITATION

Procedure
Effect of for
Accreditation
Accreditation

Additional
Accreditation shall
allow the joint venture
1.1.
Submission
ofRequirements
application
to thehousing
RFO
Sworn
Application
Accreditation;
with
a developer
offor
socialized
Limited to an NGO for
where the
projects
or the for
contribution
SEC Papers
/Accreditation:
Latest
G.I.S.;
1.2.
Specify
names
of
the
developers
of the
principal
office
of
the
applicanthousing
is
the Submission
development
of of
itssocialized
organizational
main
subdivision
projects of
inincome
the
located;
and
3.
Latest
audited
financial
&
projects
or production
socialized
profile
application
form;
and
statements
units to be
utilized
2. housing
Submit certified
true
copiesas
of compliance
latest
4.
Proof
of completion
of required
no. of
with
Section
18 of UDHA
by the developer
G.I.S.
units;
of developers
the main subdivision
project.
of
the
of main subdivision
projects.

ACCREDITATION

Suspension and
Revocation Of
Accreditation

Grounds For Suspension


of Accreditation:
Issuance of a CDO against the developer or NGO
on any of its projects;
Suspension or revocation of the CR or LS of any
of the developers or NGOs projects; and
Failure to complete the development of a
compliance project within one year from
issuance of CR or LS or within such other
period of time fixed by HLURB.

ACCREDITATION

Suspension and
Revocation Of
Accreditation

Grounds
Revocation
For Suspension
of
ofAccreditation
Accreditation:
Misrepresentation on the part of the developer
in applying for the accreditation

Suspension and
Revocation Of
Accreditation

ACCREDITATION

Procedure
1. RFO shall within five days from occurrence of
any of the grounds for suspension or revocation
report the incident to the CEO;
2. Notice to the developer or NGO to explain in
writing;
3. The CEO shall issue the suspension or
revocation; and
4. Suspension or revocation is immediately
executory.

ACCREDITATION

Suspension and
Revocation Of
Accreditation

Grounds
Revocation
For Suspension
of
Effects
of Suspension
Procedure
ofAccreditation
Accreditation:
1. Any agreement or JV entered into after
suspension or revocation shall not be allowed
as compliance;
2. Suspension
Notice to the
to explain
in
2.
or developer
revocationor
isNGO
without
prejudice
writing;
to obligation or liability
already incurred in any
JV or agreement entered prior thereto;
3. Suspension may be reinstated upon lifting of
CDO or of the suspension of LS.

ACCREDITATION

Suspension and
Revocation Of
Accreditation

Transitory
Procedure
Provision
For NGOs already accredited,
they shall request for issuance of
new certificate of accreditation.

Board
Resolution
No. 890, S. of
2012

Memorandum
Circulars
Nos. 01 05, S. of
2013

MONITORING,
SANCTIONS AND
REMEDIES

General
Rules

Both the main subdivision project and the


compliance project shall be subject to the regular
monitoring activity of the RFO where each project is
registered.
The imposition of fines and other administrative
sanctions shall be in accordance with the schedule
and guidelines promulgated by HLURB.

MONITORING,
SANCTIONS AND
REMEDIES

General
Rules

Cease and Desist Order (CDO) refers to an


order issued by HLURB directed against the
developer of a main subdivision project
enjoining it from further selling lots and/or
units in the said project.

MONITORING,
SANCTIONS AND
REMEDIES

CR or LS OF THE
COMPLIANCE
PROJECT

SUSPENDED
or
REVOKED

LS OF THE MAIN
SUBDIVISION
PROJECT

SUSPEND
/ REVOKE
& CDO
On the ground of, among

others,
non-completion or nonRFO
RFO
development of the
compliance project within the
period fixed by HLURB

MONITORING,
SANCTIONS AND
REMEDIES

CR or LS OF THE
COMPLIANCE
PROJECT

SUSPENDED
or
REVOKED
RFO

LS OF THE MAIN
SUBDIVISION
PROJECT

SUSPEND
/ REVOKE
& CDO
RFO

MONITORING,
SANCTIONS AND
REMEDIES

1. Reinstatement of the CR or LS of
the
compliance project; or
2. Submission of proof of a different
full compliance, without prejudice
liabilities already incurred.

MONITORING,
SANCTIONS AND
REMEDIES

The application for the issuance of CR/LS for


a newand
main
subdivision
anywhere
in an
the
Cease
Desist
Order (CDO)
refers to
Phils.
order issued by HLURB
directed against the
2.
Submission
of
proof
of a different
shall
not
be
accepted
or
shall
beproject
denied if
developer of a main subdivision
full
compliance,
without
prejudice
any
of the
developers
compliance
projects
enjoining
it from further
selling
lots SUSPEND
and/or
incurred.
has notliabilities
been
the
period
unitscompleted
in already
the said within
project.
/ REVOKE
fixed by HLURB.
& CDO

Thank you and visit us at


www.hlurb.gov.ph