Here in New Zealand, land covenants are common, and they’re often found in new developments. They can run indefinitely, and they can place significant restrictions on what you can do with a property.
Whether you are buying an existing property or building one, make sure you understand what is registered on the title and get clear about all the rules and restrictions that apply. The same goes for selling a property too because you need to understand what the parameters are. The key message then is do your due diligence on the terms.
Land covenants usually fall into two categories:
- Positive covenants that impose an obligation on a property owner to do something and;
- Restrictive covenants that prevent an owner from doing something to the property.
Restrictions can include things like the types of construction materials that you can use, the height and design of your house, garaging and fencing.
There can also be restrictions on what you can leave parked in your driveway and what is allowed to be visible from the street – e.g. a clothesline or even solar panels.
If you’re building, make sure your builder and architect have a copy of the land covenants before anything gets started, and if you’re unsure about anything, get legal advice.