Active discussions

Help end medical misogyny. Sign our petition.

Help end medical misogyny.
Sign our petition.

Sign the petition

Please or to access all these features

Talk
Property/DIY

Join our Property forum for renovation, DIY, and house selling advice.

Original poster

Indemnity Insurance for restrictive covenant

47 replies

billandbenflowerpotmen1 · 18/10/2019 11:09

Unsure whether to post this here or legal
But does anyone know anything about the above please?
On paper there are many restrictive covenants on my property, in reality this doesn't effect me or my neighbours but clearly it's very off putting for potential buyers now I'm trying to sell. The restrictions are nothing out of the ordinary but appear to be numerous and quite petty. Examples, without outing myself, are no outbuildings in gardens to be erected except a shed or greenhouse, no work vehicles over a certain weight, any extensions would need the land owner'd permission. In realty we all just live normally and don't put huge caravans in our gardens.
Would buying an indemnity insurance be of any help to me?

OP posts:
Jayne35 · 18/10/2019 12:23

I have some on my new purchase, no caravans on drive and permission from the council for an extension but if I did want a caravan I would use a storage facility (can't stand windows blocked by caravans - and surely I need permission from the the local council to extend anyway) to name a couple. Also, I have heard somewhere that sign written vans aren't supposed to be parked on drives anyway.

What you have listed would not put me off to be honest.

Original poster
billandbenflowerpotmen1 · 18/10/2019 12:28

Thanks Jayne35. Unfortunately there are quite a few more! None really bizarre but I think it's the amount. As for the extension covenant, yes if buyers wanted to build an extension they'd have to get PP. However they'd have to also get permission from the landowner.
Nothing put me off when I wanted to buy, however I've already had buyers drop out a while ago stating that the covenants were too restrictive

OP posts:
BernadetteRostankowskiWolowitz · 18/10/2019 12:30

Does this mean your home is leasehold? That would put me off enough to not even come and look, let alone offer.

Original poster
billandbenflowerpotmen1 · 18/10/2019 13:34

No the house is freehold. There are covenants in place originally from the owner of the land the houses are on.
People don't know when they come to look, they would only know once their solicitor started the work ( or I told them)

OP posts:
Mumdiva99 · 18/10/2019 13:39

We had one pop up right at the end of sale - the look of the house wasn't to be changed - which their solicitor took to mean our UPVC windows breached the covenent - every single house had changed the windows - and actually we had got like for like - so I don't think we had breached it. However, we paid a tiny amount for indemnity insurance (or maybe just took the amount of the sale price and let them deal with the paperwork.) It really was no big deal. So what I am trying to say is unless you have breached the covenant you don't need the insurance. Your covenants don't sound that bad.......(one of ours was no aerial to be erected on the roof).

redastherose · 18/10/2019 13:49

Those are perfectly normal restrictive covenants. Provided that you aren't in breach (ie haven't built an extension without covenant owners consent) you don't need to worry. If you were in breach ie perhaps the party with the benefit of the restrictive covenant wasn't traceable then that would be the time to buy the defective title indemnity insurance. If you are not in breach of any of the covenants there is nothing to buy insurance about!

Original poster
billandbenflowerpotmen1 · 18/10/2019 13:54

one of ours was no aerial to be erected on the roof) oh yes got that one too!
Thanks both, Ok so I haven't breached any of the covenants so no need for an insurance policy, that's good to know.
I just so wish they weren't in place, they look so restrictive

OP posts:
Rollercoaster1920 · 18/10/2019 18:35

Who is the beneficiary of the covenants? You could ask them to remove them. I had a covenant put on land I bought. But i made sure it had an expiry date.

Mumdiva99 · 18/10/2019 20:01

We did have an aerial on the roof.....when our house was built they all had cable TV provided. Then there was satelitte TV and the cable company stopped supplying the service - it was argued by not allowing aerieals was anticompetitive. Anyhow - we - and plenty of others stuck up aerials for freeview TV. It was no big deal - I did disclose it on the paperwork.

Japanesejazz · 18/10/2019 23:54

You don't mention them to the buyers at all. It is for their solicitor to determine if they are an issue and if they are they will request an indemnity which will not cost a great deal. I am a property lawyer and I NEVER give indemnity policies for restrictive covenants on freehold property.

l12d04 · 19/10/2019 00:11

When I bought my property the identity insurance was sort of passed on from the previous owner. Our solicitor assured us it wouldn't cause any problems in the future (as the covenant documents were never filed with HMLR so nobody knew what they actually contained, and therefore were unlike to stand if any legal action were to be brought) however better to be safe than sorry with the insurance, especially if you come to sell the property.

Rollercoaster1920 · 19/10/2019 01:31

The key thing is what are the covenants, could they be enforced? And if they were what is the cost?

Iirc a covenant is essentially a restriction to prevent something. To enforce the covenant needs to demonstrate that someone is being disadvantaged by the covenant being broken. Unless the council set a covenant the 'enforcement' is by the person who set it. Most move after some years (or developers complete the estate and are gone) so no one can really enforce covenants. A lot are meaningless as shown by how often they are broken.

Original poster
billandbenflowerpotmen1 · 19/10/2019 07:08

Who is the beneficiary of the covenants? You could ask them to remove them
The beneficiary is the original landowner and the person/ company who renovated the properties around 14 years ago. The covenants are in place to prevent the place looking less lovely than it does now ( it's very pretty)I'm assuming as most of the restrictions are of the aesthetic nature. There's really nothing out of the ordinary and mostly people who would choose to live here would abide by them anyway I'd imagine. It's just that when they're written down they appear to be so directive and as if one is living in a lease property as one buyer to be commented before they dropped out

OP posts:
Original poster
billandbenflowerpotmen1 · 19/10/2019 07:09

I'm 100% certain the beneficiary wouldn't remove them

OP posts:
Original poster
billandbenflowerpotmen1 · 19/10/2019 07:12

nt being broken. Unless the council set a covenant the 'enforcement' is by the person who set it. Most move after some years (or developers complete the estate and are gone) so no one can really enforce covenants.
The beneficiary still owns a few of the properties and the land and it's not likely he'll be going anywhere in the near future as he's a property developer in a nearby town

OP posts:
Neron · 19/10/2019 08:28

DH and I found out on the day before exchange when we picked up the paperwork, that there was a 15 page document full of covenants.
We literally could not do a thing to the property. Some things were a flat out ban, some things were possible if all the neighbours agreed. All were still legal and enforceable and unless we wanted to spend thousands seeing a specialist adviser then it was suck it up or walk away. We tried talking to the potential neighbours where we learnt one guy knew of and acted within the covenants and had actually reported another for breaking them.
We lost thousands in fees, search money etc but we walked. We simply were not prepared to live like that.

Original poster
billandbenflowerpotmen1 · 19/10/2019 09:24

Neron
This is my greatest fear. Clearly I don't want to share the full information when people are looking for the first time. However I don't want it to get to the final stages and they only then become aware and drop out
Ive asked estate agents what they advise and they are none the wiser. Mostly seem to say not to divulge and let the buyers solicitor sort it out.
If the people love the house I don't think it would be a worry. If they are on the fence it will put them off, it would me. Once it gets to solicitor stages it'll be more difficult to talk people through how the covenants don't really affect us at all

OP posts:
Neron · 19/10/2019 09:50

I can say from my experience, is that I am still very annoyed that these were known and not disclosed. It cost us months of our time, and thousands of pounds. I can also assure that that we DID love the house and you are wrong if you think people will just put up with it.
This is just one of the many issues with the property system. If you know there are problems, then disclose them. If people walk then they walk at the beginning, rather than playing with people's lives and putting them in the position we were from something that can be avoided.

madcatladyforever · 19/10/2019 09:56

Nobody cares about that stuff as long as it is minor, it's typical of 1940's houses in particular and our covenant includes no chickens allowed, no big caravans, no garden buildings other than shed or greenhouse. Half the street has chickens and nearly everyone has a summerhouse or garden office.
There is nobody to regulate what we do unless someone really petty decides to take the chicken owners to court which they never have in 80 years.
My house has been sold repeatedly over the years with these covenants on and nobody is bothered about it.
The lenders can sometimes be shitty and refuse the indemnity insurance as a waste of paper. My buyers lenders certainly did.

madcatladyforever · 19/10/2019 09:58

I live in a grade 2 listed property now and that really is a different kettle of fish, I can't do anything to it. But I knew that already.

Original poster
billandbenflowerpotmen1 · 19/10/2019 10:20

Neron
There's nothing anyone should take exception to apart from needing permission from the management company before doing an extension. The rest are more in line with no keeping chicken, caravans. There is one that talks about not being a nuisance to anyone else with loud music etc which I think is a wonderful thing and has me at it's been the most idealic and peaceful place I can imagine to live.
I always ask when viewing properties if there any covenants in place, tbh I wish everyone would do the same when viewing mine. I don't want to say on first viewing you can't do this this and this. However I don't want to waste my or the buyers time and money

OP posts:
PrestonNotHeston · 19/10/2019 10:35

How easy is it to get in touch with the original developers? We have covenants on our house that were set by the farming business that sold the land; the covenants themselves aren't too onerous but it's taken us nine months to get written permission from their agents to even start applying for planning permission to build a garage. If there's a working channel of communication and the covenants are reasonable it wouldn't put me off too much.^^ If it takes months to get permission to sneeze in my own garden after 9pm, then knowing what I now know, I'd probably walk away.

Original poster
billandbenflowerpotmen1 · 19/10/2019 10:46

Very easy to get hold of the developer. However not the nicest person in the world sadly

OP posts:
Neron · 19/10/2019 11:23

Ours were pretty comprehensive unfortunately. Its common to have them, particularly in new build eatates for example. In our case we could under no circumstances extend or alter the property in anyway etc which was the reason we were buying it. Totally understand you don't want to scare people away, puts you in an awkward situation too. If they will stop people doing things I think it's more important to disclose, but the more basic ones that people flout/ignore not so much.

GU24Mum · 19/10/2019 14:07

It depends too on where you live. If they were very old covenants on a single house then that's different from if you live on a modern estate where they are generally supposed to be intended both for your benefit (your neighbours can't do those things either) and also for you to comply with yourself. Assuming it's the latter, if they are mentioned, I'd try to spin the positive that they are more really of communal good neighbour rules.