A property covenant is a binding legal restriction registered on a property’s certificate of title that limits what the owner can do with the land. Unlike easements (which give someone a right to use part of your land), a covenant restricts how you use your own land. Covenants run with the land — meaning they apply to every future owner, not just the person who agreed to them. They are common in new housing estates and older subdivisions.

What are the most common types of property covenants?

• Building material covenants: Require external walls to be built from certain materials (brick, render, Colorbond) — common in new estates to maintain a consistent streetscape.
• No-subdivision covenants: Prevent the land from being subdivided into smaller lots.
• No-building covenants: Prevent buildings being erected on part of the land (e.g. rear laneways or buffer zones).
• Minimum floor area covenants: Require any house built to meet a minimum size — often used in prestige subdivisions to maintain land values.
• Use restriction covenants: Prevent commercial or industrial use of a residentially zoned lot.
• Height restriction covenants: Limit the height of buildings or fences to preserve views or solar access for neighbours.

How do I check if a property has a covenant?

Covenants are registered on the certificate of title and appear in the Section 32 Vendor’s Statement in Victoria. Your conveyancer will identify any covenants in their title search. You can also search the title yourself through LANDATA (Victoria) or the equivalent land titles office in your state.

Can a covenant prevent me from subdividing my block?

Yes — a no-subdivision covenant is legally binding and takes precedence over what the planning zone would otherwise permit. Even if the council’s planning scheme allows subdivision, a no-subdivision covenant on title will prevent it. This is a critical issue for investors buying blocks with development intentions.

Can a property covenant be removed?

Yes, but it is difficult. In Victoria, a covenant can be removed by:

1. Agreement of all beneficiaries: The parties who benefit from the covenant consent in writing to its removal — this is common where the original subdivider is the only beneficiary.
2. Supreme Court application: The court can modify or extinguish a covenant under Section 84 of the Property Law Act 1958 if it is obsolete, unreasonably impedes use of the land, or all parties consent.
3. VCAT application: In some cases, the Victorian Civil and Administrative Tribunal can deal with covenant removal matters.

Covenant removal typically costs $15,000-$60,000 in legal fees and takes 6-18 months. Success is not guaranteed.

Frequently asked questions

Are covenants the same as planning overlays?

No. A planning overlay is a government-imposed planning control under the Planning and Environment Act. A covenant is a private legal restriction between landowners, registered on title. Both can restrict what you do with your land — and both can apply to the same property simultaneously.

What is the difference between a restrictive covenant and an easement?

An easement gives a third party a right to use part of your land. A restrictive covenant is a prohibition — it stops you from doing something with your own land. Both are registered on title and bind future owners.

Do covenants apply to new estate properties?

Yes. Most new housing estates impose covenants requiring specific building materials, minimum setbacks, landscaping and fencing to maintain a consistent streetscape. These are disclosed in the Section 32 and should be reviewed before purchase.

GeeVee verdict: Covenants are one of the most overlooked due diligence items in property purchase. A no-subdivision covenant on a large block can eliminate the development potential that made the purchase attractive. Always check title for covenants — especially when buying with a development or subdivision intent.

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