Deed Restrictions vs. Covenants: What Homebuyers Need to Know

Have you ever looked at a property and wondered whether you could build a detached garage, park an RV in the driveway, or run a business from home?

Before you make plans for a property, there’s something worth checking: deed restrictions and covenants.

These terms get used interchangeably pretty often, but understanding what they mean—and where to find the rules that apply to a property—can save you some headaches down the road.

What Are Deed Restrictions?

Deed restrictions are limitations on how a property can be used. They may be included in a deed or established in another recorded document that applies to the property.

Depending on the language, restrictions might address things like:

• What types of structures can be built
• Whether a property can be used for commercial purposes
• The number or type of homes allowed on a lot
• Where buildings can be placed
• Whether certain activities or uses are prohibited

The specifics matter. One property might have restrictions on additional structures, while another might have limitations on how the land can be used.

And just because a restriction exists doesn’t automatically tell you whether it’s still enforceable. That depends on the document, applicable law, and the circumstances.

What Are Covenants?

In real estate, a covenant is a promise or obligation concerning property. Restrictive covenants limit certain uses of the land.

You’ll often encounter covenants in subdivisions or planned communities. They may be part of a recorded declaration that applies to multiple properties, sometimes alongside a homeowners association (HOA).

For example, a neighborhood’s covenants might address:

• Minimum home sizes or approved exterior materials
• Fences, sheds, and other structures
• Restrictions on certain business or commercial uses
• Property maintenance
• Whether an architectural review or approval is required

Some communities have an HOA that helps administer and enforce their governing documents. Others have recorded restrictions without an active HOA.

The important thing to remember is that the documents—not simply the presence or absence of an HOA—determine what rules may apply.

So, What’s the Difference?

Here’s the simplest way to think about it:

Deed restrictions describe limitations on a property’s use, while covenants are the promises or obligations that establish certain rights and restrictions. A restrictive covenant can function as a deed restriction, so the terms can overlap.

You may see a document called Restrictive Covenants, Declaration of Covenants, Conditions and Restrictions, or something similar. The title alone doesn’t tell you everything you need to know about the property’s obligations.

What matters is the actual language, whether the document applies to the property, and whether the provisions are enforceable.

Why Should You Check Before Buying?

This is where the topic becomes especially important for buyers.

Maybe you want to build a workshop, keep a boat or RV on your property, add a second dwelling, or operate a home-based business. You might find a property that looks perfect for your plans, only to discover that recorded restrictions limit what you can do.

Before buying, consider these steps:

1. Ask for the applicable documents. Request copies of recorded restrictions, covenants, declarations, and any relevant HOA governing documents.

2. Read the actual language. Don’t rely solely on a listing description or a seller’s informal understanding of the rules.

3. Check for additional requirements. HOA rules, local zoning ordinances, building codes, and other regulations can apply independently of deed restrictions.

4. Verify anything important to your plans. If a workshop, additional dwelling, fence, or business use is essential to your decision, confirm the requirements before moving forward. Your real estate agent can help identify questions and coordinate with the appropriate professionals.

In North Carolina, recorded land records are maintained through the appropriate county offices. The North Carolina Secretary of State provides an overview of land records and deeds.

What If a Property Has No HOA?

No HOA doesn’t necessarily mean no restrictions.

A property can be subject to recorded covenants even when there’s no active homeowners association. And a property outside an HOA community may still be subject to zoning rules, building codes, easements, and other land-use requirements.

Likewise, not every restriction you come across is necessarily enforceable today. If you have questions about a particular document or a proposed use, a real estate attorney can help determine what applies.

That’s why it’s important to look at the specific property rather than assume the rules are the same everywhere.

The Bottom Line

Deed restrictions and covenants aren’t just paperwork to skim over during a real estate transaction. They can affect what you can build, how you use your property, and whether a home or piece of land will work for your plans.

If you’re buying in New Bern, Craven County, or elsewhere in Eastern North Carolina, take time to understand the restrictions that apply before you commit.

And if you’re not sure what to look for, that’s a good question to bring to your real estate agent early in the process.

Thinking about buying a home or land in Eastern North Carolina? Addison and Jessica Johnson at TIU Real Estate are happy to help you navigate the questions that come with finding the right property.

This article is for general educational purposes and isn’t legal advice. The restrictions that apply to a specific property should be reviewed and verified based on the recorded documents and applicable law.

— TIU Real Estate | This Is Us