Understanding Property Covenants: Your Complete Guide

If you're considering purchasing a property in London, understanding property covenants is crucial. These legal obligations can significantly impact your plans for a property and failing to adhere to them could result in substantial financial consequences. So, let's delve into what property covenants entail and how they may affect you.

What exactly is a covenant on a property?

In simple terms, a covenant is a legal obligation outlined in the title deeds of a property that binds the new owner to certain conditions. These obligations typically endure indefinitely, meaning they persist even after the property changes hands. Therefore, it's essential for you, as a prospective buyer, to be aware of any covenants associated with the property you're interested in.

Types of property covenants

There are two primary types of property covenants: positive and restrictive.

Positive covenant

Positive covenants entail obligations that the title deeds impose on landowners. These obligations, known as "burdens," often require future owners to undertake specific actions or contribute financially to endeavours within the property's boundaries. Typically, positive covenants involve two parties, with an individual or entity benefiting from the covenant.

Restrictive covenant

On the other hand, restrictive covenants are more common. These covenants impose limitations on what landowners can do within their property boundaries. They specify activities or alterations that are prohibited, such as certain types of building work. Additionally, there is usually a party entitled to enforce the restrictive covenant, ensuring compliance.

Common covenant examples

Restrictive Covenants may include:

  • Prohibiting alterations to the property, such as building extensions or converting houses into flats.
  • Restricting the construction of buildings or significant structures on specific areas of land.
  • Prohibiting certain trades or businesses from operating on the property or within its vicinity.
  • Preventing the keeping of livestock on the property.

Positive Covenants may include:

  • Maintaining shared features like fences or driveways.
  • Undertaking repairs on shared structures like roofs.

Why are covenants necessary?

Property covenants serve to provide landowners with control over how their land is utilized or maintained. They often originate from the initial sale of land, with sellers incorporating restrictive covenants to preserve the residential character of an area or ensure that any permitted alterations align with its ambience.

Consequences of a covenant breach

Breaching a covenant can have significant repercussions, potentially necessitating the reversal of substantial projects like extensions. Additionally, you may incur financial penalties or face legal action. Therefore, thoroughly understanding your property deeds before embarking on any significant changes is imperative.

Can covenants be modified or removed?

If you believe a covenant on your property deeds is unreasonable, you have the option to apply to the Lands Chamber of the Upper Tribunal for its modification or discharge. However, this process can be both costly and time-consuming. Furthermore, if the covenant's removal would result in losses for the benefiting party, you may be required to provide compensation in addition to covering legal fees.

Property covenants in London

In London, property covenants often reflect the city's rich historical tapestry and diverse architectural landscape. From Georgian townhouses in Kensington to modern developments in Canary Wharf, each neighbourhood may harbour its own set of unique covenants.

Areas with historical significance may have restrictions on exterior changes to preserve their character. While newly developed areas might feature covenants aimed at maintaining communal amenities or green spaces. Additionally, London's cosmopolitan nature brings about complexities such as shared driveways or communal facilities, which may require specific covenant considerations. Understanding these nuances can help you navigate the London property market with confidence.

Frequently asked questions

How do you identify property covenants?

When purchasing a property, it's crucial to have your conveyancer thoroughly examine the title deeds for any covenants. Remember, once you sign the deeds, you are bound by these covenants, regardless of whether you were aware of them. Breaching a covenant, even unknowingly, holds you liable.

Should you buy a property with a restrictive covenant?

Whether purchasing a property with a restrictive covenant is advisable depends on the covenant's nature. If it doesn't impede your intended use of the property, such as building alterations you weren't planning, it shouldn't deter you. However, if you foresee utilizing the land in a manner that may conflict with existing covenants, careful consideration is warranted.

Are covenants legally binding?

Assuming proper establishment, covenants are legally enforceable. It's essential to ascertain whether a covenant "runs with the land," meaning it applies to all future owners, or if it's enforceable solely on the initial owner.

What is the lifespan of a covenant on a property?

Property covenants are perpetual; they do not expire. However, some very old covenants may be considered unenforceable due to factors such as unclear wording, historical obsolescence, or the inability to trace the original parties involved.

What is a deed of covenant?

A deed of covenant is a legal document wherein the party bound by a covenant pledges to fulfil its obligations.

Contact Felicity J. Lord for expert guidance

If you're navigating the intricacies of property covenants or embarking on a property search in London, Felicity J. Lord is here to assist you. Our experienced team can provide valuable insights and guidance to ensure a smooth and informed property transaction.

Don't let property covenants catch you off guard. Reach out to Felicity J. Lord today for expert assistance tailored to your needs.