What are Real Estate Deed Restrictions and how can you find out about them?
Real estate deed restrictions are typically written right into a property’s deed. Sometimes they are also called Conditions, Covenants and Restrictions (CC&R’s). They could be imposed by the developer, builder, neighborhood or homeowners’ association or the property’s past or present owners.
When considering a home for purchase, it may not be immediately apparent if there ARE any deed restrictions. As you get more serious about moving forward and placing an offer, it’s important to check, as deed restrictions can impose serious limitations on what you can do with your home. It’s best to know in advance!
How do you find out about the existence of deed restrictions? A good listing agent should research that information in the property deed before putting the home on the market and have it available upon request. A good buyer agent should make you aware of the possibility of deed restrictions and should advise you to ask the right questions when consulting you regarding your home purchase. I would recommend reviewing the deed restrictions yourself or asking your attorney to take a look.
WHY ARE DEED RESTRICTIONS NECESSARY?
At first blush, deed restrictions may seem unduly “restrictive”, unreasonable, just plain annoying or even arbitrary (no satellite dishes, no clothes lines, no above-ground pools, no fowl, etc.). However, most are imposed based on previous bad experiences and are intended to preserve property values of the neighborhood, subdivision or condo complex.
CASE IN POINT: Commercial Vehicles
“No commercial vehicles to be left in driveways” in one subdivision arose out of the fact that the developer had previously lived next door to a man, who operated a large garbage truck, which he routinely parked in his driveway overnight and on weekends, to the chagrin of the neighbors, who considered it a huge eyesore, literally and otherwise. Clearly, it was not the best presentation for the area as far as being attractive, which in turn affected local property values; hence the restriction in the new subdivision, where the developer had control.
CASE IN POINT: Dogs
“Residents are limited to one dog” – my clients were interested in a home in a subdivision that had this restriction. They had one dog and one “on the way”, ordered from a special breeder in Switzerland, so this was a very important item for them, but it was not spelled out anywhere in the listing information. In fact, it took quite a bit of “digging” to discover this fact. Both the listing agent and the owners assured us that “it would not be a problem, others have more than one dog”. Well, would you take that risk? It’s not a problem until it is. What would happen if someone chose to enforce the rule after the new puppy arrived? Would the new homeowners have to give up the dog or sell their new home?
This leads to the issue of WHO ENFORCES DEED RESTRICTIONS? It’s usually the subdivision developer or a Homeowners Association that monitors and enforces real estate deed restrictions.
It might be true that some infractions might go “unpunished” for some time, unless someone notices and complains or takes action. It’s kind of like driving above the speed limit until you get nabbed and face a heavy fine. In the case of deed restriction violations, the costs might be steeper if it meant dismantling a forbidden pool for example, removing an unauthorized house addition or facing the prospect of having to give away a family pet.
It’s always best to be informed in advance. If you are pressed for time when making an offer and don’t have the opportunity to research or review the issue, you may want to include that as a contingency in your offer: “subject to review of deed restrictions, if any”. That way you would be protected in case of any clauses in the deed restrictions that you might find unacceptable.
Again, a good real estate agent should guide you in that process as well as throughout your home buying journey. Choose well!