Real Estate Term of the Day: Covenant
COVENANT – promise written into deeds and other instruments agreeing to performance or nonperformance of certain acts, or requiring or preventing certain uses of the property (Barron’s Dictionary of Real Estate Terms)
Common items found in a neighborhood’s convents (typically enforced by an HOA) may include:
- rules regarding the maintenance of the land parcel such as: lawn care, shrubs, trees, etc.
- enforcement of architectural and design standards such as: paint color, roof color/materials, etc.
- control the density of future development
- prohibit certain practices
- where cars, trailers, boats are allowed to be parked
- discretion of who lives in the house
These covenants are put in place to protect property values by ensuring that homes/properties are well maintained and taken care of properly. They help protect the aesthetics of the neighborhood, thus establishing desirability to the community for potential buyers. Covenants should be reviewed before purchasing a home/property to ensure that your desired lifestyle won’t be compromised by your new community (e.g. if you desire to live in a neighborhood where you can park your boat on the side of your home).