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Owning a condominium unit is quite different than owning a house and lot. Knowing these differences should be among the things you should consider before deciding which type of real estate to buy.

Right To Own

It is a known fact that land ownership in the Philippines is generally restricted to Filipino Citizens. This is the biggest hurdle a foreigner should think about when buying a house and lot unit. To make things simple, a foreigner usually puts the land title in the name of a Filipino (or a Filipina) espouse or trusted friend, or a girlfriend. It is easy to see how this leads to complications when conflicts arise in the relation between the foreigner and the Filipina.

On the other hand, owning a condominium unit is valid legally for any foreigner. Perhaps, this makes condominium the only sensible option for a foreigner to buy a real estate in the Philippines. If you can afford it and you wanted a place in the Philippine Islands, go condo.

Extent of Ownership

When you own a house and lot, you also own the following:

1. anything on top of the land, including the air space, the trees, the stones
2. the house interiors and the exteriors
3. everything under the land including any mineral deposits
4. anything produced from the use of the land including the fruits of the tree, etc

That’s a lot of things to own. This could be the reason why Louis J. Glickman has said, “The best investment on earth is earth.”

In a condominium, you only own the interiors of your unit and all things contained therein. Everything else is jointly owned by you and other condominium shareholders. The land on which the condominium project stands is titled to the Condominium Corporation.

Evidence of Ownership

You know that you are an owner in fee simple of a piece of land if you have a Transfer Certificate of Title. For a condo unit, your ownership is evidenced by Condominium Certificate of Title.

A common misconception, even among the real estate professionals, is to associate the word condominium with the type of high-rise building architecture with dwelling units called condo units. Wrong, a condominium is not a building, though that is normally what we have grown to see in bigger cities like Manila, Cebu and, most recently, in Davao. In reality, any multi-unit structure like row houses and apartments can become a condominium.

Condominium Defined

The term condominium actually refers to the type of ownership, wherein an individual owns a unit and co-owns with other individual owners the commonly shared interest in the building. Typically, when you buy a condo unit, say a studio-type unit, you own that unit and you can have the title under your name. But your ownership doesn’t stop there. Together with other unit owners, you also become a co-owner with undivided interest of the common elements of community that are used by everyone else: the hallway, the corridors, the gardens, and even the land. The keyword here is ownership. As an individual owner, you own your unit; everyone else (including you) owns the “common elements” of the project.

The Condominium Corporation

In the Philippines, a condominium is actually setup as a corporation, where the individual unit owners become shareholders of the corporation. Going back to the common elements mentioned previously, it is the whole corporation that owns those. Moreover, as a share holder, you also participate in running the corporation like setting-up and following its rules.

Condominium Title

A condo unit owner is given a Condominium Certificate of Title as evidence that is he an owner. One of the good things about this title is that it can be in the name of a foreigner. Foreigners are wary of buying house and lot in the Philippines, because they cannot have the title in their name. The Condominium form of ownership provides a better, if not the best, alternative for them.