A restrictive covenant, or building covenant, is a restriction imposed by a landowner who is selling off a piece of their land that prevents the buyer from using it in certain ways. The purpose is to protect the value of the land retained by the seller. They are legally binding on any new owners of the land, and possibly any future owners.
Covenants can include restrictions on the size of any new buildings on the land, the building materials used, the time within which the construction must commence and/or be completed, vegetation preservation, fencing restrictions, and many more areas – some can be very obscure.
They can essentially mean that someone who used to own your new land or property still has an element of control over it – a concept which can be hard to swallow if it limits your plans!
Restrictive covenants are fairly common and nearly every new house will be subject to one. Developers or builders of a new estate, for example, will often require buyers of the properties to enter into a restrictive covenant in an attempt to protect the original aesthetics of their development. This type of covenant may have an expiry date.
Many older properties are also affected by restrictive covenants, but they are often much more difficult to enforce as no one knows who has the benefit of the covenant.
When could a restrictive covenant affect you?
1) If you’re looking to build a new home
Many self-builders, having found their plot, are surprised to find that there are restrictions on what, or even whether they can build on the land. This restriction could be imposed by someone seemingly unrelated to the sale. It’s therefore really important you check for covenants before buying land.
If the covenant is ‘live’ and the beneficiaries are known, covenants prohibiting any form of development on a piece of land can be a real problem – the only way to remove it would be to either agree some form of compensation or apply to the Lands Tribunal on the basis that the original purpose of the covenant is no longer relevant. Chances of successfully removing the covenant in such a case would be limited.
If the covenant is ‘dead’ – in that it does exist but the beneficiary cannot be traced – you’d be in a better position to proceed. One option is to purchase a Single Premium Indemnity Policy to protect you should a beneficiary come forward.
A more likely situation that you might come across is where the vendor has imposed a covenant which restricts the right of any developer of the land to have, for example, windows in an elevation that overlooks their property. Even if you have planning permission to include such windows, the covenant overrules this and you’d have to change your plans.
Another possible scenario is where a covenant on a piece of land allows the vendor to approve the design of any new dwelling on the land – it pays to be aware of this before you get too far in the planning process.
2) If you’re planning on extending your current property
If you’re buying a property with plans to extend or renovate in the future, be sure you check if there are any covenants in place which may prevent this.
For example, if the previous owners of your house built it in their garden, when they sell the property they may include a covenant so that future owners cannot build an extension and spoil the view from their own home.
How can you find out if there is a covenant on your land or property?
Details of any covenant will be contained within the information held by the Land Registry. Some covenants are very old and the reason they were originally imposed may no longer be relevant. But, no matter how old they are, the covenant cannot be removed or disregarded unless they are extinguished by agreement (often a long and costly process involving the Lands Tribunal).
Restrictive covenants: what you should do
If you’re buying a new piece of land with the intention of developing a property, or if you’re looking to extend your existing property, it’s really important to be aware of any restrictive covenant imposed.
If you’re planning to buy a property with the intention of changing the property’s use or carrying out any building work, it’s a good idea to let your solicitor know of your plans before incurring any other fees (such as surveys). They can look at the contract and title documents and advise you of anything in the documentation which will conflict with your plans.
If you find there is a covenant which would prevent you from carrying out the works you were planning, look really carefully at the wording in order to judge its true strength. It’s a good idea to get the help of a legal professional to understand who is entitled to enforce the covenant, or give consent to your plans. Often it’s the current owner of the land, but in some cases, this can go back to the original vendor. In that instance, there is often doubt over whether the covenant would be enforceable against any subsequent buyers.
It can be quite a complicated area – we recommend you seek professional advice before taking any action if you suspect a covenant is in place.