Convenants and Restrictions May Restrict Options For Your Castle
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Just because your home is your castle doesn't mean you can build a moat!
Before purchasing raw land, a home, or a condo check what you can and cannot
do with it. Virtually every piece of real property has some type of restriction
or covenant that may limit development or usage.
Many of these are restrictions imposed by local government. For example, most
communities have zoning or building regulations for setbacks, i.e. the distance
that must be maintained between any structure and the property lines. If this
could spell the end of your dream to add a sunroom off the side or an attached
garage, better you know this up front.
Communities often restrict home businesses. It is doubtful you would ever get
in trouble running a website out of the family room, but a home beauty shop,
real estate office, or any business that would generate unusual traffic are
verboten in many areas that are residentially zoned.
While it isn't common, some communities limit lot coverage or floor
area ratio (FAR). This has generally been a restriction on commercial
building in order to alleviate congestion and improve street level light and
ventilation. However a type of FAR has been invoked recently in an attempt to
control mansionization in residential areas. You might want to know this if
you envision a big addition or plan to tear down an old structure and rebuilt.
These types of restrictions are generally found in local government publications
such as the building code or zoning ordinance and a good real estate attorney
should be very knowledgeable about them. However, the attorney you hire to review
your real estate contracts and certify the title on your new property may not
suspect that you plan to add a wing to or open a doggy day care in your home
and thus should not be expected to warn you that you can't. Ask specifically
if your plans can be accomplished without extensive and expensive legal expense
or even at all.
Any towns with historic districts the district commissions
can be both powerful and vicious. Their mandates may allow them to control all
exterior changes to the structure including new windows, siding, even paint
color. Sometimes these restrictions apply beyond the actual district to homes
that are visible from it.
Another type of covenant may be found in your deed. Developers often put in
protective covenants when building a subdivision or condominium
project. People buying condos are generally aware that there will be restrictions
on ownership and these are generally contained in the master deed, individual
unit deeds, or both. But subsequent actions by the homeowners association
(HOA) might have added others so it is important to check HOA minutes. Condo
restrictions commonly include what can be done to or on the exterior of individual
units but they may also impact on usage. For example balconies are a frequent
target and grills, birdfeeders, or any kind of storage such as for bicycles
or strollers may be forbidden. Putting in a greenhouse window or skylight, parking
a boat or an RV, or buying a dog may run an owner afoul of the HOA and the latter
example can be devastating if the condo owning pet owner is caught off guard.
Buyers may not be aware, however, that individual subdivisions often have covenants
put in place by the developer. Architectural covenants are common, perhaps requiring
minimum square footage for new building or limiting new homes or renovations
to a certain style or requiring that all exterior changes be reviewed by an
architectural committee. Subdivision covenants can require a timeline for trash
barrels to be brought in from the curb or for garage doors can be open, or the
kind of fences that can be erected. This is also a place where usage can be
regulated, from allowable businesses to the number and type of animals that
can be kept, to what can be parked in the driveway and for how long.
Developers move on, and in the case of single family developments, the HOA
may do the same, no longer enforcing covenants or the additional rules and regulations
they may have adopted when the subdivision was young. Under certain conditions
a totally dormant HOA can arise from the dead to the dismay and sometimes financial
detriment of persons who bought into the area with no knowledge there had been
such an entity.
True story. In 2004 a woman bought a small vacant lot, one of the last remaining,
in a 1960's development of 400 homes. No one seemed to notice the cinderblock
foundation being built on the land but everyone noticed when two flatbeds moved
down the street, each carrying half of a manufactured home. What ensued must
have been worthy of U-Tube. It was the middle of the day but there were enough
neighbors around to physically block the flatbeds, the police were called and
settled everyone down, and the HOA, last heard from in the 1980s, was reestablished
in less than a week. It is now an organized and highly efficient group which
has made enormous improvements to the appearance and cohesiveness of the neighborhood.
But one new homeowner who had bought property weeks before this happened was
told he could not build a home for his sister on a second, non-conforming lot
included in his purchase. He subsequently sold at a loss and moved on. The manufactured
home violated several town restrictions as well as the subdivision covenants,
but once in place it is doubtful anything would have been done.
These covenants and restrictions are largely a good thing.
They were enacted in the first place to keep communities and neighborhoods attractive
and livable (what could be worse than having your new neighbor hauling an engine
at 7 a.m. in his make-shift driveway auto repair business). But before you buy,
you need to make sure that what you want to do with your property can be done.
If you have a plan for immediate changes, even if it seems straightforward,
make it a condition of your offer so that you and your attorney have time to
check out its permissibility on the site. Make sure your attorney reviews not
only town ordinances (a local real estate attorney should know them by heart)
but also your deed, any master deed that may apply to your condo or subdivision.
As to the HOA that arises like Lazarus, there may be nothing you can do but
accept it for its virtues and take the hit.
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