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Article Courtesy of MoneyWise
By Sigrid Forberg
Published December 20, 2020
When most people buy a home, they’ll spend countless hours
imagining all the things they plan to do with it: where they’ll build a swing
set or maybe how they’ll build up the garden.
But what many homebuyers don’t realize is that even though you own the home, you
may not have the right to make certain changes to the property.
While it’s always best to do your research and avoid buying a home with deed
restrictions, you still have a chance to fight to keep your dreams alive.
When you buy a home, a legal document called a deed transfers from seller to
buyer. It contains details such as the names of the new and former owners and a
description of the property.
However, your deed may also list certain restrictions that have been placed on
the property that are legally binding for all future owners.
Those restrictions often originate from homeowners associations (HOAs) hoping to
protect the area’s quality of life and property values, but they can also be
established by government agencies for the public good.
Types of deed restrictions
Deed restrictions may limit what you can do with the property or how you are
permitted to keep it. Some common deed restrictions relate to:
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The home’s square footage or number of bedrooms.
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Structure and height restrictions on foliage, trees or
fences.
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How many vehicles you’re allowed on the property and
where you can park them.
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What animals you’re allowed to keep.
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The number of outbuildings (sheds, garages, poolhouses)
you’re allowed.
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Limits on the color, materials and design you can use in
exterior renovations.
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Whether you can use the property for business purposes.
But there could be many more types of restrictions placed on
a home.
Sometimes these rules are known as “restrictive covenants,” especially when
they’re set and enforced by an HOA.
Deed restricted communities
When you live in a condominium, townhouse or a planned community or subdivision,
you may have an organization that manages and enforces the rules for your area.
Deed restrictions can function like normal HOA rules for a community, but
they’re legally attached to the land itself and may be more difficult to change.
These HOAs can be quite strict about their covenants, especially when the homes
are in a mainly residential area. Since the members of your HOA tend to be your
neighbors, violations are pretty likely to be called out.
Benefits
When you live in a deed-restricted community, you’ll never have to guess what
your neighbors expect from you because you have the rules all written out.
And, assuming your home isn’t an outlier, you’ll know everyone is held up to the
same standard.
This can appeal to homeowners who agree with the restrictions and crave a
peaceful and orderly neighborhood.
Risks
Conversely, deed-restricted communities don’t suit the type of homeowner who
prefers full agency over their property.
Having to choose between a few set colors you can paint the exterior of your
home or being told where you are allowed to park your car would ruffle the
feathers of some individuals.
What happens if you break a deed restriction?
It’s best to know about any restrictions before you commit to a home. Ask your
real estate agent to pull any restrictions that may have been indicated in
previous listings.
Deed restrictions may also come up in a title search of the property, so you can
order one yourself or talk to a lender about that stage of the process. This may
not be part of a title company’s standard services, so be sure to ask for that
to be included.
If you know there’s an HOA overseeing the neighborhood, read through the bylaws
thoroughly for any restrictions that may pose an issue.
Research is key; unfortunately, not knowing isn’t going to get you off on a deed
restriction violation.
These restrictions can only be enforced by the entity that wrote them into the
deed. You may simply be asked to fix the issue or face a fine. It’s rare, but
depending on the severity of the violation the dispute could escalate to a
lawsuit and a court injunction.
How to change your deed restrictions
Depending on the age and origin of the deed restriction, you may not have to do
anything at all.
For example, the individual or organization responsible for enforcing the rule
may be long gone. Or the rule may have become obviously unlawful in the time
since its creation — for example, a rule declaring what kind of people are
allowed to occupy the home.
If you do have to challenge the rule, first try issuing a direct appeal to the
person or group who originally put the restriction on your property, asking them
to lift it.
In the case of an HOA, you could ask for a vote on removing the restriction. If
it’s your municipality that’s imposing the rule, you could bring the issue to
your local city council.
If they won’t budge, you may need to go to court. A lawyer could help you argue
that the restriction is unlawful, unenforceable or unfair — but you’ll have to
accept that the rule may stand at the end of the day. |