Living with Deed Restrictions

Deed restrictions are an established means of regulating land use. Properly implemented, deed restrictions govern such things as (1) property use and (2) the kind, character, and location of buildings or other structures.

Deed restrictions are also known as restrictive covenants.

Example: Some homeowners wanted to make structural changes to refurbish their old house. Their contractor thought the proposed modifications would violate a deed restriction requiring 51 percent of the house’s exterior to be either brick or stone. The restriction was placed on the subdivision by the original developer.

The party imposing the restrictions must first own the land; then the restrictions may be placed in subsequent deeds or recorded with a subdivision plat.

Deed restrictions may appear in two forms. One is called a personal covenant, the other a real covenant.

Personal covenants are binding only between the present grantor and the grantee. After that, subsequent owners are unaffected.

Real covenants directly affect the use and enjoyment of the property. They “run with the land” or “touch and concern” the property. This means the covenant and the property are inseparable once the covenant is recorded. All subsequent transferees will be subject to the covenant whether the restrictions are explicitly referred to in the conveying instrument or not. Consequently, not only are the original grantor and grantee entitled to the benefits and liable for their obligations but so are the successive owners of the property.

Deed restrictions have become a popular tool for developers to preserve and protect the value of land, thereby making the property more attractive to buyers. Developers employ restrictive covenants (or subdivision restrictions) to regulate the size and location of structures; quality, cost, and design of improvements; setback and yard requirements; architectural styles, and other uses of the property.  Also, the activity of the owners may be regulated. For example, certain commercial enterprises may be prohibited in exclusively residential areas.

Not all restrictive covenants are enforceable. 

The grantor has the right to impose restrictions and have them enforced as long as they are:

(1) reasonable in nature,

(2) not immoral or illegal

(3) not contrary to public policy.

Restrictive covenants forbidding the sale or transfer of property to, or occupancy by, persons of a certain race or religious faith are unenforceable. If the restrictive covenant is ambiguous or not clearly drafted, all doubts will be resolved in favor of the free use of the property and against the enforceability of the restriction. Deed restrictions have become a popular tool for developers to preserve and protect the value of land, thereby making the property more attractive to buyers. Covenants are binding only between the present grantor and grantee.