Property covenants may affect your plans for a property and could lead to significant expenses if breached. Here’s what you need to know.
What is a covenant on a property?
A covenant is a legal obligation outlined in a property's title deeds that new owners must adhere to. These obligations typically extend indefinitely, so it's crucial for buyers to be aware of any covenants affecting a property they're considering purchasing.
Types of property covenants
There are two types of covenant: positive and restrictive.
Positive covenant
Positive covenants impose obligations on landowners, requiring them to undertake specific actions or contribute financially within the boundaries of the land. These obligations involve two parties, with one party benefiting from the covenant.
Restrictive covenant
Restrictive covenants, more common in practice, limit the actions of landowners within their property boundaries. These restrictions may include prohibitions on certain activities or alterations, such as building work. A party typically benefits from and can enforce the restrictive covenant.
Common examples of property covenants
Restrictive covenants commonly prohibit:
- Property alterations like extensions or conversions
- Construction of substantial structures on specific land areas
- Operation of businesses or trades on the property
- Keeping of livestock on the premises
Positive covenants may include responsibilities like maintaining shared features such as fences or driveways or repairing shared roofs.
Purpose of covenants on property
Landowners use covenants to maintain control over how their land is utilized or appears. These covenants may originate from initial land sales, ensuring the land remains for designated purposes or maintains specific characteristics.
Consequences of breaching a covenant
Breaching a covenant could require undoing large projects or facing legal consequences and financial penalties. Understanding property deeds before undertaking significant changes is crucial to avoid these issues.
Modifying or removing covenants
To modify or discharge a covenant deemed unreasonable, an application can be made to the Lands Chamber of the Upper Tribunal. However, this process can be costly and time-consuming, potentially involving compensation payments to affected parties.
Frequently asked questions
How can I find property covenants?
During the property purchasing process, conveyancers examine title deeds to identify any covenants. These obligations apply to all subsequent property owners, making thorough checks essential.
Should I buy a property with a restrictive covenant?
The decision depends on the covenant's nature and its impact on your intended use of the property. Consider potential future plans and whether the covenant aligns with them.
Are covenants legally binding?
Legally established covenants are enforceable, with some applying to all future property owners.
How long do property covenants last?
Property covenants endure indefinitely, though some may become unenforceable over time due to various factors. For instance, some very old covenants might pertain to outdated customs or be rendered irrelevant by modern advancements. Additionally, factors such as inability to trace the original landowner or unclear covenant language can contribute to a covenant's obsolescence.
What is a deed of covenant?
A deed of covenant is a legal document wherein the obligated party commits to fulfilling covenant obligations.
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