Land use laws and real estate industry

In his second State of the Nation Address, President Duterte mentioned the need for enacting the proposed National Land Use Act which he considers one of his administration’s six priority bills but which has been languishing in Congress for more than two decades. The proposed measure aims to institute a comprehensive national land use policy, provide implementing mechanisms, and rationalize in a sustainable way the utilization of Philippine lands and their resources. The reason for Congress’ inaction, according to observers, is that the bill’s intention of projecting spatial allocation for different land uses disturbs many landed lawmakers who would rather have unhampered disposition over the areas they control.

Thus, the bill has dim prospects because of the threat it poses to the real estate industry. But there are still many laws that we can and should employ to rationalize land use as we face the pressures created by a growing population and the imminent dangers posed by climate change and disaster risks. If fully implemented, these laws (totaling close to 40), despite many of them being piecemeal, conflicting and outdated, can still provide a balancing effect on the excesses of real estate service practitioners, developers and conniving government officials.

The real estate industry is currently showing a strong performance and, because of its nature of creating multiplier effects in other sectors of the economy, it can contribute considerably toward boosting economic growth. But as the industry pursues its pecuniary interests, there is a need for its practitioners to observe ethical standards that will promote the livability of communities and the integrity of the environment. In the constant conflict between the economist-developer and the ecologist-conservationist schools of thought, the former need not always prevail as a balance can be achieved between people and planet.

Today there is more to real estate transactions than simply bringing buyers and sellers together. In advanced countries, real estate professionals are increasingly seen as “gatekeepers” in various transactions. It is thus only fair for clients of real estate professionals to be informed of the ecological, economic and sociocultural issues and concerns pertaining to the subject of the transaction. In the Philippines, however, there are realtors who do not observe the code of ethics and responsibilities required of them by the Real Estate Service Act. Even in the United States, it was observed in a 1998 study that 57 percent of lawsuits brought against practitioners were for misrepresentation and 12 percent were for failure to disclose material information. Locally, there are real estate agents who disregard red flags in the properties they transact and simply subscribe to the philosophy of caveat emptor (let the buyer beware). A recent example is the controversial Torre de Manila project that disregarded heritage considerations and zoning restrictions.

Considering the present administration’s intention of strictly implementing laws related to land use, it is incumbent upon real estate developers and service practitioners to carefully study the provisions of such laws as well as the guidelines of the agencies concerned with land use, housing and urban development. In places where they operate, they should familiarize themselves with the locality’s zoning ordinance, land use plan and physical and sociocultural characteristics. In particular, they should not connive with local officials in abusing legal flexibility provisions such as variances, exceptions, as well as special use and temporary use permits.

There is much to say on unbridled real estate transactions which could go haywire — as in the case of the US subprime mortgage crisis of 2007-2010 — and which, in the case of disregarding proper land use principles, could even lead to irreparable damage to the environment.

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Meliton B. Juanico, a retired professor of geography at UP Diliman, is a licensed environmental planner and is active in consultancy work in urban and regional planning.