Hiring a Real Estate Broker to Sell a Condominium in the Philippines
A practitioner-oriented legal guide (updated May 2025)
1 | Why bother with a broker?
Selling a condo looks simple until you confront (a) the 30-day BIR tax clock, (b) a buyer who wants bank financing, (c) the condo corporation’s clearances, or (d) a title with a tiny technical error. A licensed real-estate broker is trained (and legally obliged) to shepherd you through all of that. Under the Real Estate Service Act (RESA, R.A. 9646) only duly licensed brokers may “offer, advertise, solicit, list, promote, mediate or negotiate” a real-estate sale for compensation. (SPR Boracay Real Estate)
2 | Who is a “licensed” broker?
| Requirement | Current rule | Key references |
|---|---|---|
| Licensure exam & PRC ID | PRC-administered Real-Estate Broker exam plus registration and annual Professional Identification Card | RESA §14–17 (SPR Boracay Real Estate) |
| Continuing Professional Development (CPD) | 45 CPD units per 3-year cycle. Undertaking accepted until 31 Dec 2025 per PRC Res. 1908-2024 | (Professional Regulation Commission) |
| Professional tax receipt & bond | Annual PTR from local city + Php 20 000 surety bond | RESA IRR Rule III §§19–20 |
| Disclosure of license | PRC ID number must appear on all ads and contracts | RESA §38; Code of Ethics Art. IV (phappraiser.wordpress.com) |
Tip: Verify any broker’s PRC license via PRC Online Verification Service or ask for the physical ID.
3 | Legal framework you and your broker must respect
| Statute / Regulation | Relevance to a condo sale |
|---|---|
| RESIDENTIAL PROPERTY LAWS | |
| - R.A. 4726 (Condominium Act) | Defines condominium ownership; foreign-ownership 40 % cap. (Lawphil, RESPICIO & CO.) |
| - P.D. 957 (Subdivision & Condominium Buyer’s Protective Decree) | Regulates ads, escrow of buyer deposits, penalties for misrepresentation (developer or broker). (Lawphil) |
| AGENCY & CONTRACT | |
| - Civil Code Art. 1874 | Authority of broker must be in writing or the sale is void. (Lawphil) |
| - Statute of Frauds, Art. 1403 | Contracts for sale of real property must be written. |
| PROFESSIONAL REGULATION | |
| - R.A. 9646 (RESA) + Code of Ethics | Licensing, duties, sanctions. (SPR Boracay Real Estate, phappraiser.wordpress.com) |
| TAXATION | |
| - NIRC §24(D) & BIR RRs | 6 % Capital Gains Tax (CGT) on higher of gross price/zonal/FMV; file & pay within 30 days. (Bir Cdn) |
| - Sec 196 DST | 1.5 % Documentary Stamp Tax (DST). (real-estate-guide.philsite.net) |
| - LGU Transfer Tax Code | 0.5–0.75 % transfer tax. (RESPICIO & CO.) |
| - VAT (if unit > Php 3.6 M) | Sale of residential dwellings above Php 3.6 M subject to 12 % VAT per RR 1-2024. (CREBA) |
| ANTI-MONEY LAUNDERING | R.A. 9160 as amended: cash sale > Php 7.5 M must be reported by broker within 5 BD. (Anti-Money Laundering Council) |
| ANTI-DUMMY LAW | A brokered sale cannot appoint foreigners as managing officers of brokerage firms. (PwC) |
4 | The brokerage contract (“Authority to Sell”)
Form. A written “Exclusive or Non-Exclusive Authority to Sell” signed by the registered owner (or by an attorney-in-fact via notarized SPA) is mandatory. (propertymart.ph)
Types.
- Exclusive Authority / Right-to-Sell – one broker; commission is earned even if you sell the unit yourself during the listing period.
- Non-Exclusive / Open Listing – several brokers; whoever closes gets paid.
Essential clauses
- Property details (CCT no., floor area, parking slot)
- Asking price & net take-home price
- Professional fee (see §5)
- Listing term + hold-over clause (usually 3–6 months)
- Marketing budget & advertising platforms
- Taxes/fees allocation (customarily seller: CGT & agent’s withholding tax; buyer: DST, transfer tax)
- Dispute-resolution venue (often HLURB/DHSUD or courts of Makati/Taguig)
Notarization. Highly recommended; some developers and banks refuse unnotarized authorities.
Failure to give written authority exposes both parties to administrative liability (broker) and a void sale (owner). (propertymart.ph)
5 | What will it cost? (Broker’s compensation)
- Prevailing range: 3 % – 5 % of gross selling price for condo resales; luxury units or co-brokerage can reach 6 %. (houses.forsalephilippines.com)
- VAT & EWT: If the broker is VAT-registered (annual receipts > Php 3 M), add 12 % VAT to the fee; the seller withholds 10 % (or 5 %) expanded withholding tax on the net professional fee.
- When due: At deed signing or on release of buyer’s funds. With bank buyers, the broker’s commission is paid out of the proceeds table funded by the bank.
6 | Duties of the broker vs. duties of the seller
| Broker (professional duties) | Seller (ownership duties) |
|---|---|
| Verify title & liens; secure certified true copy of CCT | Provide original CCT, tax declaration, and latest real-property tax (RPT) clearance |
| Prepare Comparative Market Analysis & marketing plan | Disclose material defects; hand over house rules & arrears statement from condo corp |
| Market property (MLS, portals, viewings) compliant with PD 957 advertising rules | Keep unit accessible for viewing; maintain utilities |
| Draft Contract to Sell / Deed of Absolute Sale | Sign and have documents notarized; issue SPA if abroad |
| Assist in BIR e-CAR processing & LGU tax payments | Pay CGT (6 %) and broker’s EWT/VAT within 30 days |
| File AMLA Covered or Suspicious Transaction Reports if threshold met | Provide valid IDs, TIN, and anti-money-laundering declarations |
Brokers are bound by the National Code of Ethics to act with fidelity, disclose conflicts, and keep client data confidential. (phappraiser.wordpress.com)
7 | Taxes, fees & timeline checklist
| Step (working days) | Government office | Who normally pays | Notes |
|---|---|---|---|
| 1. Compute & pay CGT (6 %) + DST (1.5 %) (within 30 days of notarization) | BIR RDO where condo is located | Seller (CGT); Buyer (DST) | File BIR Forms 1706 & 2000-OT, plus 60-page supporting docs |
| 2. Secure e-CAR (14-30 days) | BIR | Seller/representative | Needed before title transfer |
| 3. Pay Transfer Tax (0.5–0.75 %) (within 60 days) | LGU Treasurer | Buyer | Rate varies per city/province |
| 4. Register Deed & new CCT (7-15 days) | Registry of Deeds | Buyer | Registration fee ≈ 0.25 % |
| 5. Notify Condominium Corp. | Condo Management | Buyer | New membership, share transfer, move-in clearance |
If the gross price is ≤ Php 3.6 M, the sale is VAT-exempt under RR 1-2024; otherwise add 12 %. (CREBA)
8 | Special legal issues for condominium units
- Parking slots: Often held under a separate CCT and taxed/transferred separately.
- Developer’s right of first refusal: Check the Master Deed or condo by-laws.
- Common-area arrears: Unpaid dues follow the unit; agree in writing who shoulders arrears prior to cut-off.
- Foreign seller/buyer: 40 % foreign-ownership ceiling on the entire condo project still applies even on resale. Brokers must verify current foreign-owner ratio via condo corporation records. (RESPICIO & CO.)
- Leaseback/Airbnb restrictions: Many condos now record use restrictions; a broker should disclose these to avoid post-sale disputes.
9 | Anti-Money-Laundering & Data-Privacy compliance
Real-estate brokers and developers are “covered persons” under AMLA. Any single cash transaction > Php 7.5 M must be reported via a Covered Transaction Report within 5 business days; suspicious deals are reportable regardless of amount. Failure exposes the broker and possibly the seller to hefty fines and criminal liability. (Anti-Money Laundering Council)
Brokers also process IDs, proof-of-address, and bank details—personal data protected by the Data Privacy Act (R.A. 10173). Ensure the brokerage issues a privacy notice and keeps records secure.
10 | Common disputes & enforcement
- Unlicensed “agents.” Selling through a colorum agent is punishable by up to Php 200 000 fine and 4-year jail term. (SPR Boracay Real Estate)
- Seller re-listing with multiple brokers despite exclusivity. Broker may sue for full commission or file an HLURB/DHSUD complaint; courts routinely enforce hold-over clauses if the buyer was first introduced during the listing period.
- Tax under-declaration. BIR can assess deficiency CGT + DST within 3 years (10 years if fraud).
- Foreign management involvement. Violates Anti-Dummy Law and can invalidate corporate acts. (PwC)
ADR choices: mediation at PRC-accredited ADR centers, arbitration clauses in the Authority to Sell, or filing before regular courts / DHSUD.
11 | Best-practice checklist for sellers
- License verification: Screenshot PRC verification page.
- Background check: Ask for track record and two previous client contacts.
- Written exclusivity (3–6 mo) with clear commission and hold-over clause.
- File management: Digital copies of CCT, tax dec, IDs, SPA, clearance letters.
- Realistic pricing: Let broker support price with recent comparative sales.
- Unit readiness: Minor repairs, declutter, professional photos.
- Sign only one notarized Deed of Sale; have broker route it to BIR.
- Track BIR e-CAR status; don’t turn over keys until CAR is released and buyer pays in full.
- Keep receipts & tax proofs for at least 10 years.
- Ask for a closing statement detailing the exact government-receipt numbers, broker’s VAT/EWT, and net proceeds.
12 | Frequently asked quick points
| Question | Short answer |
|---|---|
| Can I pay commission in crypto? | Yes, but disclose source of funds and expect AMLA scrutiny. |
| Is staging or photography part of the broker’s fee? | Only if expressly included in the Authority to Sell. |
| How long before the new CCT is issued? | Metro-Manila RDs average 2–4 weeks after e-CAR & taxes. |
| What if the buyer backs out after deposit? | Keep earnest money only if forfeiture is provided in the contract; otherwise refund. |
13 | Take-away
Hiring a licensed, ethics-bound real-estate broker is not an added cost—it is your legal shield and project manager rolled into one. With the right contract, full disclosure, and timely tax compliance, you can close a Philippine condominium sale smoothly, safeguard your proceeds, and sleep soundly knowing the deal will withstand BIR audits and court scrutiny.
(This article is for general information only and is not a substitute for personalized legal advice.)