iRealtee OS Glossary

License to Sell (LTS)

The License to Sell serves as official government authorization confirming that a developer has met all regulatory requirements to market and sell properties wi...

License to Sell (LTS)

License to Sell (LTS) is a regulatory certification issued by the Department of Human Settlements and Urban Development (DHSUD) that authorizes real estate developers to legally sell subdivision lots, condominium units, and other real property to the public in the Philippines.

Definition

The License to Sell serves as official government authorization confirming that a developer has met all regulatory requirements to market and sell properties within a registered project. Under Presidential Decree 957 (the Subdivision and Condominium Buyer's Protective Decree), no owner or developer may sell any subdivision lot or condominium unit without first obtaining an LTS from DHSUD.

The license provides two key assurances:

  • Proof of the developer's legitimacy and financial capability to complete the project
  • Quality assurance that building plans and specifications meet regulatory standards

Key Provisions

  • Mandatory Requirement: All residential subdivisions, townhouses, condominiums, commercial developments, memorial parks, and similar projects must secure an LTS before selling units
  • Registration First: Developers must obtain a Certificate of Registration (CR) before applying for the License to Sell
  • Performance Bond: Developers must post a performance bond based on the extent of development before the LTS is issued
  • Publication Requirement: A Notice to Publish must be completed in a newspaper of general circulation for 13-17 days (depending on project type) before issuance
  • Processing Timeline: 20-25 working days for PD 957 projects; 14-25 working days for BP 220 (socialized housing) projects

Who is Affected?

  • Real estate developers: Must secure LTS before marketing any project
  • Real estate brokers: Must verify LTS validity before authorizing agents to sell developer projects
  • Real estate salespersons: Should only sell properties from developers with valid LTS
  • Property buyers: Protected by ensuring developers meet regulatory standards

Penalties

Selling without a valid License to Sell constitutes a violation of PD 957. Consequences include:

  • Administrative penalties from DHSUD
  • Revocation of the Certificate of Registration
  • Criminal liability under the Subdivision and Condominium Buyer's Protective Decree
  • Civil liability for damages to affected buyers
  • Prohibition from engaging in further real estate development activities

Relevance to Real Estate Practice

For real estate brokers and agents, verifying a developer's LTS is a critical compliance step before authorizing the sale of any project. You should:

  • Request a copy of the LTS from the developer
  • Verify the LTS number and validity through DHSUD's registry
  • Confirm the project scope matches what is covered in the license
  • Check that the LTS has not expired or been revoked

When using real estate software like iRealtee, broker-owners can maintain a developer whitelist to track accredited developers with valid LTS documents. This helps ensure your entire sales team only markets legitimate, licensed projects.

The developer management module allows you to store and track LTS documentation, expiration dates, and project-specific details. Combined with sales document management, you can maintain a complete compliance record for each development you represent.

References

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