If you are searching on whether you can sell land with restrictions on it then you have arrived at the right property website. In this blog we are going to explore what is a restrictive covenant, types of restrictive covenants, problems that arise when restrictive covenants are breached and finally how to sell your land with restrictive covenant in place. So without further delay, let’s get into it…
So what is a restrictive covenant?
A restrictive covenant is a legal obligation that is imposed in a document created either historically in relation to property or in a current transaction by the Seller on the Buyer of a property. Normally restrictive covenants are placed to outline things you can or cannot do on that land. Restrictive covenants are recorded against the title of the property and then “run with the land”. This means that restrictive covenants also apply to subsequent owners of the property as they are registered against the property’s title with Land Registry. This makes it incredibly difficult to sell land or property but thankfully there is a way out.
Types of restrictive covenants
Most common types of restrictive covenants include:
- Restrictions on access over land such as a right of way
- Restrictions within wording of leases such as changes to internal structures that will require freeholders’ permission or prescribed usage of property, type of flooring that can be used in a flat, time for playing music or what types of pets can be kept within the property.
- Restrictions on residential developments on the land or any new building.
- A prohibition on using land for any operating any trade or business activities.
What if there are restrictions or they have been breached?
In all cases where there are restrictive covenants are in place but, these have not been breached and, where such restrictions are understood and accepted by a buyer and his, her or their lenders, there may be no difficulty.
However, problems can arise with property transactions where restrictions on the title or in a lease have already been breached. The issue will then be how old is the breach, what type of breach is it, does the protected party know about this breach, what is the buyer’s lenders attitude to the potential risks associated with the property being bought after a covenant has been breached. In all of these breaches often a buyer will walk away from the transaction.
Clearly, there is a more significant issue if existing restrictive covenants have not been breached but the existence of the covenants will impact either on the buyer’s use of or plans for the property or have an adverse impact on the intrinsic value of the property. It may be possible to get the restriction removed but this can be extremely difficult in situations where the covenant has been recorded against the title to the property for years or decades and it can be very difficult to establish who now owns the benefit of the restriction.
You probably have tried to sell land with restriction on it and it is possible that your buyer was not able to purchase the land because of restrictive covenant in place. Most solicitors will advise their clients not to buy any property or land that has restrictive covenants in place – this is because often restrictions can be so punitive that the land or property could be worth less than its original purchase price once acquired. Furthermore, many lenders refuse to lend against land or property with restrictive covenants in place, as they are worried with recovery of their funds in the event of repossession or property turning into negative equity.
How to sell your land with restrictive covenant in place
Property Saviour is a specialist property buyer who can help you sell land with restriction on it. We buy all sort of land and property with all types of restrictive covenants in place and even properties with seriously complex legal issues such as breaches of covenants, defective leases and missing freeholders of restrictive covenants. If you are thinking about selling your land with restrictive covenant in place, why not get in touch with Property Saviour and see how we can help you.
We will buy all types of land with restrictive covenants in place provided that it meets our investment criteria. We have cash ready to buy your land or property with restrictive covenant and will also pay for your legal fees towards selling your land or property. We will make you a fair cash offer with a quick completion date that suits all parties. So why not get a no obligation free offer from us today?