Buying a house or piece of land is complex. As the value is likely to be high, it is of the utmost importance that you satisfy yourself that it will be fit for purpose before money changes hands. One thing that could dramatically impact your quiet enjoyment of your new property is finding out after your purchase that a restrictive covenant is in place that you were not aware of.
What is a restrictive covenant?
A restrictive covenant is a clause written into your property’s title deeds that restricts what you can do with the property; for example, it may prevent you from extending or altering the appearance of the property, keeping particular animals, or subletting it.
Why do restrictive covenants exist?
Their intended purpose is to protect an area from activities that could be seen to devalue it; however, in some cases, they are outdated, unnecessary, and overly strict.
Challenging a restrictive covenant
If the property or land you wish to buy is subject to a restrictive covenant that would impede your enjoyment of the property, you have three choices. You could pull out of the sale, ask the current owners to have the covenant removed, or take out restrictive covenant insurance.
Removing a restrictive covenant comes at a cost, will introduce time delays, and the sellers may be unwilling to negotiate on this point. Restrictive covenant insurance may protect you against breaching the covenant if you are unable to locate the original owner of the deed to have it removed or renegotiated.
Is a Form LL restriction a restrictive covenant?
No, this is a separate legal process that prevents a property from being sold without the legal owner’s permission. It is an anti-fraud measure that, if in place, will require the support of a lawyer such as Parachute Law to remove it before the sale completes.
In conclusion
Restrictive covenants are applied to a property’s title deeds for various reasons. They are not usually a blocker to the sale, but you will need to assure yourself that you are satisfied with the restrictions before proceeding.
