Condominium Rental Checklist (Philippines)

A practitioner-oriented legal guide, updated to 24 June 2025

Disclaimer – This article is for general informational purposes only and is not a substitute for individualized legal advice. Philippine law changes frequently, and local ordinances differ from city to city. Always consult a Philippine-licensed lawyer or the relevant government agency before acting.

1. Governing Legal Framework

Level	Key Issuances	What They Cover (highlights)
Statutes	• Republic Act (RA) 4726 – “The Condominium Act”, as amended (RA 7899) • Civil Code of the Philippines (Book IV on obligations & contracts; Art. 1654–1688 on lease) • RA 9653 & successive one-year extensions through 31 Dec 2027 – “Rental Reform Act / Rent Control”	Nature of condominium ownership, corporation & by-laws, lessor/lessee obligations, rent-increase caps for units with monthly rent ≤ ₱10,000 (NCR) / ₱5,000 (other areas), ejectment grounds
Administrative	• HLURB/BHFS rules on condominium project registration & advertisements (now under DHSUD) • BIR Revenue Regs. 7-2002, 16-2005, 12-93, 16-2004, etc. on taxation of lease income • LGU ordinances on sanitation, transient accommodation, short-term leasing, fire safety, garbage fees	Advertising, taxation (VAT/percentage tax, DST, CWT), business permits, safety certificates, short-term rental restrictions
Special Laws	• Data Privacy Act 2012 (RA 10173) • Consumer Act (RA 7394) for deceptive ads	Lessee data collection; truthful marketing
Judicial & Quasi-Judicial	• Supreme Court jurisprudence on ejectment, forfeiture of security deposit, sub-leasing, condo corp. standing • DHSUD Adjudication Commission decisions on HOA/condo disputes	Interpretations applied to rental controversies (e.g., Yu v. Ducat, Jamisola v. Bocaue, etc.)

2. Pre-Lease Due Diligence Checklist

For the LESSOR (Unit Owner)	For the LESSEE (Tenant)
□ Verify that your Condominium Certificate of Title (CCT) is clean (no liens, annotations). □ Ensure you have board/condo corp. clearance to lease (some by-laws require notice or registration and fees). □ If your mortgage lender requires it, secure consent to lease. □ Update real-property tax (RPT), association dues, and utilities.	□ Ask for a copy of the CCT (or at least the number) to check ownership at the Registry of Deeds or via e-Serbisyo. □ Get a copy of the Condo Corp.’s House Rules & Regulations – especially move-in procedures, pet policy, use of amenities, renovation protocols, penalties. □ Inspect for latent defects and check developer’s warranty (one-year workmanship, 15-year structural). □ Confirm rent control coverage (see § 1).
□ Obtain/renew barangay & city business permits if leasing is treated as a business (common in short-term/Airbnb setups). □ Draft a compliant Data Privacy Notice if you require IDs, CCTV, or biometric access.	□ Verify that the lessor’s tax status is clear – ask who shoulders VAT/percentage tax so you’re not surprised by pass-throughs. □ Confirm parking slot ownership and the right to use/assign it.
□ Determine tax profile: • Individual ≤ ₱3 M gross → 8 % GIT option or graduated rates. • Individual / Entity >₱3 M → 12 % VAT (unless solely residential ≤ ₱15 K /mo, exempt). • DST (Documentary Stamp Tax) ₱3.00 for each ₱1,000 of annual rent.	□ Check insurance: building’s master policy rarely covers tenant’s personal property; consider renter’s insurance.

3. Drafting & Executing the Lease Contract

Parties & Authority
- If the owner is abroad, secure a SPA (Special Power of Attorney) notarized & apostilled.
- For corporate owners, attach the latest SEC GIS and board resolution.
Premises & Use
- Exact unit number, floor area, parking slot.
- Permitted use (residential only, no staff-housing, no Airbnb sub-lease unless allowed).
Term & Renewal
- Fixed term (typically 12 months) with automatic renewal/hold-over clause (Art. 1670).
- Stipulate non-applicability or applicability of rent-control caps on renewal.
Rent & Escalation
- State base rent, escalation schedule, association dues treatment, utilities, parking fees, VAT/withholding.
- If covered by rent control, escalation cannot exceed the statutory ceiling (currently 5 % annually).
Deposits & Advance Rent
- Max two (2) months security deposit + one (1) month advance is industry standard.
- Condition for refund – specify interest earnings, inspection timeline (Art. 1654, SC cases require prompt turnover).
Taxes & Withholding
- Lessee must withhold 5 % CWT (if lessee is a business) and issue BIR Form 2307 monthly.
- Lessors issue BIR OR (VAT/OPT) or non-VAT invoicing depending on status.
Maintenance & Repairs
- Minor repairs (≤ broadly ₱3,000 or 1 % of monthly rent) by tenant; structural/major by owner.
- Access for inspection with 24–48 h notice.
Association Dues & Special Assessments
- Clarify which party pays regular dues, utilities, sinking fund.
- Special assessments (e.g., façade repainting) typically owner’s duty.
House Rules Compliance
- Attach a condo corp. certificate that the tenant has been briefed.
Insurance & Indemnity
- Waiver of subrogation, indemnity clause for negligence.
Termination & Ejectment Grounds
- Non-payment of rent, nuisance, sub-leasing, lease expiration.
- For covered units, ejectment allowed only on statutorily enumerated grounds (RA 9653 § 9).
Dispute Resolution
- Highly recommended: venue clause (e.g., courts of Makati), and mediation then arbitration per ADR Act.
Notarization
- Required for enforceability vs. third parties; notarized lease is a public document.
Registration (Optional)
- Lease > 1 year should be annotated on the CCT to bind successors (Sec. 4, Property Registration Decree).

4. Post-Execution Compliance

Lessor’s Obligations	Lessee’s Obligations
• Pay income tax / VAT / percentage tax, file monthly & quarterly returns (BIR 2550M/Q, 1702/1701Q). • Remit withheld DST if lessee is not remitting. • Issue Official Receipts within 5 days of payment. • Remain in good standing with condo corp. & LGU sanitation/fire inspections.	• Pay rent on or before due date. • Withhold and remit 5 % CWT if business lessee. • Observe house rules; register guests as required. • Maintain insurance if agreed.
• Perform major repairs within 30 days of notice (Art. 1654).	• Allow inspection at reasonable time.
• Return security deposit within 30 days after turnover less lawful deductions (Art. 1654; SC in Niñal v. Badilla).	• Restore unit to original condition minus normal wear.

5. During Tenancy: Practical Compliance Tips

Association Dues ≠ Rent – Non-payment of dues by owner can lead to disconnection or access restrictions; prudent tenant may pay directly (and offset against rent) if lease allows.
Unit Improvements – Any installation becomes owner’s property upon permanent attachment (Art. 1678), unless removal agreed.
Sub-Leasing & Airbnb – Requires written consent of owner and condo corp.; many by-laws ban daily rentals entirely.
Quiet Enjoyment – Owner cannot disturb possession; common issue is owner’s agent showing unit to prospects without notice.
Pet Rules – Some LGUs (e.g., QC, Taguig) have companion-animal ordinances requiring humane treatment; rules cannot contradict RA 9482 (Anti-Rabies Act).

6. Termination & Turn-Over Checklist

Step	Timeframe	Actor	Key Documents
Notice of Non-Renewal / Pre-termination	Typically 30-60 days before desired exit	Tenant or Landlord	Written notice, acknowledgment
Pre-move-out Inspection	≥ 7 days before turnover	Both	Inspection sheet, photo inventory
Utility Clearances	Prior to last day	Tenant	Meralco, Manila Water, PLDT letters
Condo Corp. Move-out Permit	2-3 days before	Tenant	Clearance slip, settled dues
Security Deposit Accounting	Within 30 days	Landlord	Statement of deductions, OR for repairs
Release & Quitclaim	Upon acceptance	Both	Signed waiver to avoid future claims

7. Tax Snapshot (FY 2025)

Scenario (Residential Unit)	Tax Treatment
Monthly rent ≤ ₱15,000 & owner’s cumulative annual gross < ₱3 M	Exempt from VAT; subject to 3 % percentage tax unless opting for 8 % GIT
Owner chooses 8 % Gross Income Tax (GIT) in lieu of graduated rates + percentage tax	File BIR 1701A; no VAT, no percentage tax
Total gross receipts > ₱3 M OR unit is commercial use	Subject to 12 % VAT + graduated income tax
Documentary Stamp Tax on lease	₱3.00 per ₱1,000 of yearly rental value (pay within 5 days of signing)
Withholding Tax (business lessee)	5 % of gross rent; remit via BIR 1601EQ monthly

8. Common Pain Points & How to Avoid Them

Issue	Prevention / Cure
Owner retains deposit for “painting & general cleaning”	Enumerate specific deductible items in lease; require receipts.
Condo corp. disallows tenant’s live-in caregiver	Clarify occupancy limits & guest policy in House Rules annex.
LGU fines for short-term letting	Check city zoning ordinances & tourism code beforehand; secure DOT accreditation if > 6 units.
Tenant refuses to vacate after expiration	Use summary ejectment (Rule 70) at MTC; 30-day notice + 10-day answer + judgment.
Owner fails to issue OR; tenant cannot book rent as expense	Insert tax-compliance clause with right to suspend rent until receipt issued.

9. Quick-Reference Master Checklist

Title & Authority validated
Condo Corp. clearance obtained
Lease contract drafted, notarized, stamped
Taxes (DST, VAT/OPT, CWT) computed & filed
Association & LGU permits settled
Move-in documents (inventory, IDs, car sticker) processed
Insurance confirmed
Data privacy notice delivered
Renewal reminder diarized 60 days before end
Move-out procedures & deposit refund mechanism agreed in writing

Final Thoughts

A Philippine condominium lease is more than a standard house rental; it interweaves condominium law, tax rules, condo association by-laws, and ever-changing rent-control extensions. Both landlord and tenant can avoid costly friction by following the above checklist, seeking professional advice early, and keeping meticulous records.

Prepared by: [Your Name], Philippine real-estate lawyer