How do deed restrictions and covenants affect what a property owner can do?
Deed restrictions (also called restrictive covenants or CC&Rs) are private agreements recorded in property deeds that limit how land can be used. Unlike zoning, which is a government regulation, deed restrictions are created by developers or property owners and enforced by homeowners' associations or neighboring property owners through civil lawsuits.
Key Takeaways
- Deed restrictions (also called restrictive covenants or CC&Rs) are private agreements recorded in property deeds that limit how land can be used.
- Rules vary by state; always learn your specific state's requirements.
Property Ownership & Land Use on the Real Estate Exam
Deed restrictions are tested on every state real estate exam because they represent a key limitation on property rights that exists outside of government regulation. Agents must be able to explain to buyers what restrictions apply to a property and how they differ from zoning. Failing to disclose known deed restrictions can create liability for agents and brokers.
Understanding Property Ownership & Land Use: Key Concepts
What It Means
Deed restrictions, formally known as restrictive covenants or covenants, conditions, and restrictions (CC&Rs), are private limitations placed on property use by a grantor or developer. They 'run with the land,' meaning they bind not just the original parties but all future owners of the property. Common examples include minimum square footage requirements, architectural style mandates, prohibitions on commercial use, requirements to maintain landscaping, and restrictions on the number of vehicles parked on a lot.
Deed restrictions are created when a developer records a declaration of covenants with the county recorder's office, typically before selling any lots in a subdivision. Once recorded, the restrictions apply to every lot in the development. They can also be created by individual property owners through deed language when transferring property.
Consequences and Enforcement
Enforcement of deed restrictions differs from zoning enforcement. Zoning violations are handled by government code enforcement officers and can result in fines or orders to cease activity. Deed restriction violations must be enforced privately: a homeowners' association (HOA) or an affected neighbor must file a civil lawsuit or seek an injunction. Courts can order compliance, award damages, or in some cases void a transaction that violated the restrictions.
Deed restrictions can be more restrictive than zoning but cannot be less restrictive. If zoning allows commercial use but a deed restriction limits the property to residential use only, the deed restriction controls. However, a deed restriction cannot permit something that zoning prohibits.
Restrictions can be terminated by expiration (if they include a time limit), by agreement of all property owners in the subdivision, by a court ruling that conditions have changed so substantially that enforcement is no longer reasonable, or if they violate constitutional protections. Discriminatory restrictions based on race, religion, or national origin are unenforceable under the Fair Housing Act, even if they still appear in recorded documents.
Property Ownership & Land Use Rules by State
Each state has its own rules when it comes to property ownership & land use. Here are a few examples of how requirements differ:
California
California Civil Code Sections 1460-1471 govern restrictive covenants. California requires that discriminatory covenants be redacted from recorded documents when property is sold. The Davis-Stirling Common Interest Development Act provides comprehensive rules for HOA enforcement of CC&Rs, including dispute resolution requirements before litigation.
Texas
Texas Property Code Chapter 202 governs restrictive covenants and gives property owners' associations broad enforcement powers. Texas allows deed restrictions to be renewed by a vote of property owners, and some municipalities (including Houston, which has no traditional zoning) rely heavily on deed restrictions to regulate land use.
Florida
Florida Statutes Chapter 720 (Homeowners' Associations) governs deed restriction enforcement for residential communities. Florida requires HOAs to provide written notice and an opportunity to be heard before imposing fines for covenant violations. Florida courts have upheld strict enforcement of CC&Rs, including architectural review requirements.
Know the difference between deed restrictions (private, enforced by civil lawsuit) and zoning (government, enforced by code enforcement). The exam loves to test this distinction. Also remember that deed restrictions can be stricter than zoning but never less strict, and that racially discriminatory covenants are unenforceable even if they remain in the recorded deed.
Rules vary across all 50 states
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