What You Should Know About Restrictive Covenants

Posted on by convey_admin

When you are buying a property, you may encounter what is known as a restrictive covenant. This is a written binding condition included in a property’s deed or contract by a seller. This dictates what a homeowner can or cannot do with the property under specific circumstances. For instance, a restrictive covenant can prevent new owners from altering the architectural style of the building or keep them from building new structures on a specific part of the land. It could also state that the new owner cannot use the property for trade or other businesses. 

In this post, Conveyancing Expert, a trusted conveyancer in Manchester discusses all you need to know about restrictive covenants:

Why Are Restrictive Covenants Used?

In most cases, they are established to maintain certain standards for residents in a particular community. Housing developers usually add restrictive covenants to transfer deeds so that owners won’t do anything that could possibly affect the neighbourhood negatively or break from the desired “uniformity” of the area.

The restrictions in such cases are often minor, like the prohibition of installing satellite dishes, parking a boat or a caravan in front of the house, keeping livestock in the yard, painting the house a loud colour, or others. 

Land owners may also create restrictive covenants on the lands they are selling to protect their value and minimise damage. 

Are Restrictive Covenants Only Applicable to New Builds?

No. They can be placed even on older properties. Moreover, the age of the covenant won’t have any effects on its validity. There are cases, though, where really old covenants are accepted as unenforceable due to the fact that its original builder cannot be traced or because of ambiguous wordings that make it hard to apply. It may also be deemed void if the covenant is historically obsolete. 

How Will a Restrictive Covenant Affect You?

What you should know about restrictive covenant is that it is applicable to all future purchasers of the property and not just the first or original buyer. They call it “running with the land”. That’s why it is important for you as a buyer to discuss this with your conveyancing solicitor so they can examine the deeds to see if there are any covenants before you sign anything. Remember that once signed, you will already be accountable for any breaches that you incur. 

Additionally, you should check where the ‘benefit of the covenant’ is located and whether or not it has passed onto another person or company. This is because they will be responsible for the enforcement of the restriction and answering queries related to the covenant. 

As a buyer, you should also determine if the property’s value will be affected in the future due to the provisions of a covenant. There are cases in which mortgage lenders refuse to approve loans on properties where a covenant is determined to potentially affect their saleability in the future. In such cases, you can contact the successor in title and current vendor and tell them that you cannot proceed due to the covenant. It’s possible for them to remove the restriction, especially if it’s evident that the covenant is going to affect their ability to sell the property, too. 

Conclusion

These are just some of the basics that you need to understand about restrictive covenants. As you can see it can be one of the factors that can make purchasing a property more complicated, and definitely among the reasons you need quality conveyancing services. A seasoned conveyancer can review deeds to determine if there are any covenants that you should be aware of and give you advice regarding the best steps that you should take. 

If you need a reliable conveyancer in Manchester, trust only Conveyancing Expert. We can make the process of buying a property smooth and hassle-free for you. Contact our team to get a quote today!

2,048 thoughts on “What You Should Know About Restrictive Covenants”

  1003. I don’t think the title of your article matches the content lol. Just kidding, mainly because I had some doubts after reading the article.

Leave a Reply

Your email address will not be published. Required fields are marked *

Copyright © 2009-23 Conveyancing Expert All rights Reserved. Registered in England and Wales No.07421084.