Buying Land with a Restrictive Covenant in Victoria: What Every Homeowner Should Know Before You Buy

Restrictive covenants are one of the most misunderstood aspects of residential property in Victoria. Many buyers discover them only after they've purchased land and started designing their dream home, often when it's too late to make simple changes.

At Enclave Architects, we've worked on numerous sites affected by restrictive covenants. One of the biggest misconceptions we encounter is the belief that if a design complies with the Planning Scheme or receives Council support, it must also comply with the covenant.

Unfortunately, that's not how restrictive covenants work.

This guide explains what a restrictive covenant is, why it matters, what to look for before purchasing land, and how to determine whether your dream home is actually possible.

What is a Restrictive Covenant in Victoria?

A restrictive covenant is a private legal agreement registered on the property's Certificate of Title that limits how land can be used or developed.

Unlike planning controls, restrictive covenants are not created by Council. They are generally created by previous landowners or developers to maintain a particular character or standard within an estate.

Common restrictions include:

• Maximum number of storeys

• Minimum construction materials

• Building setbacks

• Roof forms

• External finishes

• Minimum dwelling size

• Number of dwellings permitted

• Prohibition on subdivision

Some covenants were written over 100 years ago and continue to affect land today.

The Biggest Misunderstanding: Planning Controls and Covenants Are Different

This is where many people become confused.

Victoria has planning controls that regulate development through the Planning Scheme.

These include:

• Zoning

• Overlays

• ResCode

• Building Regulations

• Local Policies

A restrictive covenant sits completely outside the Planning Scheme.

That means your proposal can satisfy every planning requirement and still breach the covenant.

Likewise, a proposal might satisfy the covenant but require planning approval.

They are two separate systems operating at the same time.

Council Does Not Decide Whether a Covenant Is Breached

This surprises many homeowners.

Council planners may identify that a proposal appears inconsistent with a covenant, but they are not the legal authority that determines whether the covenant has been breached. But they will not process the application until covenant conditions are met or legally justified.

Ultimately, interpretation of restrictive covenants is a legal matter.

If there is disagreement about the meaning of the covenant, it may require legal advice or determination through the courts.

This is one reason why obtaining proper advice early is so valuable.

Why Reading the Covenant Isn't Always Enough

Many people read the covenant themselves and assume the wording is straightforward.

Unfortunately, legal interpretation is rarely that simple.

For example, a covenant may state:

"No dwelling shall exceed two storeys."

Most people immediately think:

"That's easy—we'll build two storeys."

But what exactly counts as a storey?

Does a basement count?

What if the basement projects above ground?

What if the land slopes?

What if the Planning Scheme defines a basement differently?

These are not simple questions.

The wording of the covenant may appear clear, but its legal interpretation can be far more complex than most buyers realise.

A Real Example

Imagine a sloping block where the lower level becomes exposed because of the natural fall of the land.

Under the Victorian Planning Scheme:

• a basement that projects no more than 1.2 metres above natural ground level is generally not considered a storey for planning purposes.

However, a restrictive covenant may not refer to the Planning Scheme definition at all.

Instead, it may simply prohibit more than two storeys.

Depending on how that covenant is interpreted, the exposed basement could potentially be considered an additional storey.

This demonstrates why planning compliance and covenant compliance are not necessarily the same thing.

Covenants Were Often Written Long Before Modern Planning Rules

Many restrictive covenants were created decades before the current Victorian Planning Scheme even existed.

As a result, they often use language that predates modern planning terminology.

Terms like:

• basement

• storey

• external wall

• dwelling

• frontage

may not align with today's planning definitions.

This is why relying solely on Planning Scheme definitions can sometimes lead to incorrect assumptions.

Five Things You Should Check Before Buying Land with a Covenant

1. Obtain the Full Covenant

Never rely on the selling agent's summary.

Obtain the complete Certificate of Title together with every covenant document.

The actual wording matters.

Every sentence can affect your future design.

2. Understand What the Covenant Restricts

Read through every clause carefully.

Common restrictions include:

• building materials

• height

• number of dwellings

• external finishes

• roof materials

• fencing

• subdivision

Don't assume older covenants are no longer enforceable.

Many remain legally valid today.

3. Consider Your Design Goals

Before buying the land, ask yourself:

Do I want:

• a basement?

• multiple storeys?

• modern cladding?

• large glazing?

• multiple dwellings?

• subdivision?

• a flat roof?

• extensive retaining?

The answers may immediately identify potential covenant issues.

4. Understand the Difference Between Planning and Legal Advice

Architects and town planners can identify potential covenant issues.

However, legal interpretation may require specialist legal advice.

Where uncertainty exists, obtaining legal advice before purchasing land can save enormous time and expense.

5. Don't Wait Until Your Design Is Finished

This is one of the most expensive mistakes people make.

Designing an entire home before discovering a covenant restriction can mean:

• redesign costs

• consultant fees

• delays

• planning complications

• disappointment

Checking the covenant before design begins is always easier.

Can a Restrictive Covenant Be Removed?

Possibly.

However, removal is rarely simple.

Depending on the circumstances, options may include:

• obtaining consent from beneficiaries

• applying through the Supreme Court

• applying through the Victorian Civil and Administrative Tribunal (VCAT) where legislation permits

• redesigning the proposal to comply

Every covenant is different.

The appropriate pathway depends on the wording of the covenant, the surrounding properties and the specific legal circumstances.

Does an Old Covenant Still Apply?

Often yes.

Age alone does not invalidate a covenant.

Many Victorian suburbs still contain covenants created in the early 1900s.

Unless removed or varied through the appropriate legal process, they generally continue to affect the land.

Should You Avoid Buying Land with a Covenant?

Not necessarily.

Some of Melbourne's most desirable suburbs contain restrictive covenants.

The key is understanding them before you purchase.

A covenant should simply become another design consideration—provided you know about it early enough.

Many covenant issues can be successfully worked through with careful design.

How Enclave Architects Assesses Covenant Sites

At Enclave Architects, we believe the best design decisions are made with the best available information. Restrictive covenants can significantly influence what can be built on a property, and in some cases their interpretation may not be straightforward. That's why we undertake a thorough review of all available information before developing the design.

Where available, we ask our clients to provide:

• Certificate of Title

• Plan of Subdivision

• Restrictive Covenant documents

• Planning Property Report

• Existing feature and level survey

• Any legal advice, legal opinions or barrister's advice previously obtained regarding the covenant

• Any correspondence from Council relating to the covenant or previous planning applications

• Any reports, investigations or interpretations prepared by a professional title searcher, title consultant or other property professional

• Any historical research into the covenant, including previous attempts to vary or remove it

• Previous planning permits, planning decisions or VCAT matters relating to the property

• Any additional documentation that may assist in understanding the intent, interpretation or application of the covenant

  
  

We then review this information alongside the property's planning controls, zoning, overlays, neighbourhood character, site topography, orientation and design opportunities to identify any potential constraints before significant design work begins.

Where the wording of a covenant is ambiguous or open to interpretation, we recommend that clients obtain advice from an appropriately qualified legal professional. Existing legal advice or title research can often provide valuable insight into how a covenant has previously been interpreted and may help avoid unnecessary redesign, delays or costly assumptions.

Our role is not to provide legal advice, but to ensure the architectural design is informed by all available information and coordinated with the advice of the relevant professionals. By identifying potential covenant issues early, we can develop design solutions that respond to both the planning framework and the legal constraints affecting the land, giving our clients greater confidence before investing further in the project.

Frequently Asked Questions

Can Council ignore a restrictive covenant?

No.

Planning approval does not remove or override a restrictive covenant.

Can I build if my neighbours don't object?

Not necessarily.

A covenant is a private legal restriction.

Neighbour support alone does not automatically remove it.

If my architect designs it, does that mean it complies?

Architects can identify potential covenant issues, but legal interpretation may require specialist legal advice where uncertainty exists.

Can modern materials breach an old covenant?

Yes.

Many older covenants specify brick, stone or concrete construction.

Modern cladding systems may not satisfy those requirements.

Can I rely on the real estate agent's advice?

No.

Always obtain the actual covenant documents.

Never purchase land based solely on a summary.

Final Thoughts

Restrictive covenants are not necessarily something to fear, but they are something to understand.

The biggest mistake buyers make is assuming planning approval and covenant compliance are the same thing. They are separate systems, each with its own rules and considerations.

By identifying covenant issues early, understanding what they actually restrict, and seeking the right professional advice where required, you can avoid costly redesigns and make informed decisions before committing to a property.

At Enclave Architects, we believe great design starts with a thorough understanding of the site. Reviewing planning controls, title documents and restrictive covenants at the outset allows us to uncover constraints early and develop solutions that work with the land rather than against it.

Whether you're considering purchasing a property with a covenant or have already discovered one during the design process, taking the time to understand its implications can save significant time, cost and frustration—and help ensure your project starts on the right foundation.

Disclaimer

The information contained in this article is provided for general educational and informational purposes only and does not constitute legal, planning, financial or professional advice.

While every effort has been made to ensure the information is accurate at the time of publication, restrictive covenants are legal instruments and their interpretation can vary depending on the specific wording of the covenant, the facts of each property, applicable legislation and relevant court decisions. Every property is different, and information that may be applicable to one site may not be applicable to another.

This article should not be relied upon as the sole basis for purchasing land, designing a development, making planning decisions or determining whether a restrictive covenant applies to a particular property. Before purchasing land or making decisions that may be affected by a restrictive covenant, you should obtain independent advice from appropriately qualified professionals, including legal practitioners experienced in property law and other relevant consultants where required.

Enclave Architects does not provide legal advice, nor should any part of this article be interpreted as a legal opinion regarding the enforceability or interpretation of any restrictive covenant. Our role is to identify potential design implications and coordinate with the appropriate professionals to assist in developing informed design solutions.

Enclave Architects accepts no liability for any loss, damage or costs arising from reliance on the information contained in this article without obtaining independent professional advice.