Your Landlord Sold the House. What Happens to Your Lease?

When a landlord sells, the question every tenant asks is whether the lease goes with the house or dies with the old owner. The honest answer is that it depends. But most guides get the shape of “it depends” wrong. They treat it as a single sliding scale of factors, when it is actually three clean cases with three different rules. Worse, the case that protects the most Davao renters is the one nobody writing about this cites. So here are the three, in order. Each turns on a different statute.

Case one: the lease is recorded

If your lease is entered in the Registry of Property, the buyer is bound by it. Article 1648 of the Civil Code states the principle plainly: “Every lease of real estate may be recorded in the Registry of Property. Unless a lease is recorded, it shall not be binding upon third persons.” A buyer is a third person. A recorded lease binds them. They take the property subject to your remaining term. Registration is constructive notice to the world under PD 1529 Section 52, from the moment of entry.

There is a practical catch, and it sends most tenants to case two. You usually cannot record the lease yourself. PD 1529 Section 53 requires the owner’s duplicate certificate of title to be presented for any voluntary instrument to be registered, and a tenant does not hold it. Recording a residential lease therefore needs the landlord’s cooperation, which is rarely given, which is why the overwhelming majority of Davao leases are unrecorded.

Case two: the lease is not recorded

This is where most tenants actually sit, and where the famous rule lives. Article 1676 reads, in full:

“The purchaser of a piece of land which is under a lease that is not recorded in the Registry of Property may terminate the lease, save when there is a stipulation to the contrary in the contract of sale, or when the purchaser knows of the existence of the lease… If the sale is fictitious, for the purpose of extinguishing the lease, the supposed vendee cannot make use of the right… The sale is presumed to be fictitious if at the time the supposed vendee demands the termination of the lease, the sale is not recorded in the Registry of Property.”

One textual note before the substance: Article 1676 speaks of “a piece of land,” and a rented house is sold together with the lot it stands on, so the rule reaches the ordinary case of a sold house. Read it carefully. One word carries the whole rule: may. Article 1676 gives the buyer a right to terminate, not an automatic termination. Your lease does not vanish when the deed is signed; it ends only if the buyer chooses to exercise that right, and then only through the ordinary route of a demand followed, if you do not leave, by a court case. And the right is not clean. It comes pre-loaded with three exceptions, written into the article itself.

The middle exception is the one to lean on. A buyer who walked through an occupied unit, who was told there was a tenant, who saw the lease in the seller’s disclosure, or who collected a month’s rent, knows of the lease — and loses the right to terminate on that basis alone. The tenant’s best move is to document that knowledge early: a buyer who inspected the place you are plainly living in will struggle to claim ignorance later.

Case three: the unit is covered by rent control

Here is the case the competition does not cite. For most Davao renters, it is the one that decides everything. If your unit is covered by the Rent Control Act, the recorded-versus-unrecorded distinction the whole of cases one and two turns on simply does not apply to the sale. RA 9653 Section 10 is titled Prohibition Against Ejectment by Reason of Sale or Mortgage, and it says:

“No lessor or his successor-in-interest shall be entitled to eject the lessee upon the ground that the leased premises have been sold or mortgaged to a third person regardless of whether the lease or mortgage is registered or not.”

That last clause is a direct override of Article 1676’s entire axis. Sale is simply not on the list. Section 9, which sets out the lawful grounds for ejectment, does not include one anywhere. So for a covered unit, the buyer cannot end the lease on the ground that they bought the property, whether the lease was recorded or not.

Whether you are covered is a specific test, and Davao’s status decides the threshold. Because Davao is a highly urbanised city, the covered ceiling is ₱10,000 a month, not the ₱5,000 that applies elsewhere — so a residential unit renting at ₱10,000 or below is covered. The full pass-or-fail test is worked in the guide to whether your Davao rent is covered by rent control; run it first, because if you pass, cases one and two barely matter.

The notice you are actually owed, and one honest limit

Two closing points, because this is where confident-sounding guides go wrong. First, Article 1676 supplies no notice period at all. Not thirty days, not any number. Nothing in its text says how much warning a tenant gets. The periods come from elsewhere: a court ejectment needs a demand to vacate first and then five days for a building or fifteen for land before suit; a covered owner reclaiming the unit for personal use owes three months’ notice under RA 9653. A blanket “the buyer must give you N days under Article 1676” is an invention.

Second, the honest limit on all of this. The Section 10 protection lasts only as long as the Rent Control Act is kept in force by the housing board, and the current extension runs only to the end of 2026 with no 2027 successor yet announced — so a covered tenant should re-check coverage into 2027 rather than assume it. And no Supreme Court ruling squarely resolving the clash between Article 1676 and Section 10 was found for this guide; the conflict is plain on the face of the two texts, but its judicial resolution is not something this article will claim to have read.

If you are the one being sold out from under

For the coverage test that decides case three, the rent-control coverage guide walks it step by step, and if you are weighing leaving on your own terms instead, breaking your lease early in Davao covers the other direction. The broader picture of what a Davao tenant can and cannot be made to do is in the guide to tenant rights in the Philippines.