Just because your home is your castle doesn't mean you can build a moat!
Before purchasing raw land, a home, or a condo check what you can and cannot do with it. Virtually every piece of real property has some type of restriction or covenant that may limit development or usage.
Many of these are restrictions imposed by local government. For example, most
communities have zoning or building regulations for setbacks, i.e. the distance
that must be maintained between any structure and the property lines. If this
could spell the end of your dream to add a sunroom off the side or an attached
garage, better you know this up front.
Communities often restrict home businesses. It is doubtful you would ever get
in trouble running a website out of the family room, but a home beauty shop,
real estate office, or any business that would generate unusual traffic are
verboten in many areas that are residentially zoned.
While it isn't common, some communities limit lot coverage or floor area ratio (FAR). This has generally been a restriction on commercial building in order to alleviate congestion and improve street level light and ventilation. However a type of FAR has been invoked recently in an attempt to control mansionization in residential areas. You might want to know this if you envision a big addition or plan to tear down an old structure and rebuilt.
These types of restrictions are generally found in local government publications such as the building code or zoning ordinance and a good real estate attorney should be very knowledgeable about them. However, the attorney you hire to review your real estate contracts and certify the title on your new property may not suspect that you plan to add a wing to or open a doggy day care in your home and thus should not be expected to warn you that you can't. Ask specifically if your plans can be accomplished without extensive and expensive legal expense or even at all.
Any towns with historic districts the district commissions can be both powerful and vicious. Their mandates may allow them to control all exterior changes to the structure including new windows, siding, even paint color. Sometimes these restrictions apply beyond the actual district to homes that are visible from it.
Another type of covenant may be found in your deed. Developers often put in protective covenants when building a subdivision or condominium project. People buying condos are generally aware that there will be restrictions on ownership and these are generally contained in the master deed, individual unit deeds, or both. But subsequent actions by the homeowners association (HOA) might have added others so it is important to check HOA minutes. Condo restrictions commonly include what can be done to or on the exterior of individual units but they may also impact on usage. For example balconies are a frequent target and grills, birdfeeders, or any kind of storage such as for bicycles or strollers may be forbidden. Putting in a greenhouse window or skylight, parking a boat or an RV, or buying a dog may run an owner afoul of the HOA and the latter example can be devastating if the condo owning pet owner is caught off guard.
Buyers may not be aware, however, that individual subdivisions often have covenants put in place by the developer. Architectural covenants are common, perhaps requiring minimum square footage for new building or limiting new homes or renovations to a certain style or requiring that all exterior changes be reviewed by an architectural committee. Subdivision covenants can require a timeline for trash barrels to be brought in from the curb or for garage doors can be open, or the kind of fences that can be erected. This is also a place where usage can be regulated, from allowable businesses to the number and type of animals that can be kept, to what can be parked in the driveway and for how long.
Developers move on, and in the case of single family developments, the HOA may do the same, no longer enforcing covenants or the additional rules and regulations they may have adopted when the subdivision was young. Under certain conditions a totally dormant HOA can arise from the dead to the dismay and sometimes financial detriment of persons who bought into the area with no knowledge there had been such an entity.
True story. In 2004 a woman bought a small vacant lot, one of the last remaining, in a 1960's development of 400 homes. No one seemed to notice the cinderblock foundation being built on the land but everyone noticed when two flatbeds moved down the street, each carrying half of a manufactured home. What ensued must have been worthy of U-Tube. It was the middle of the day but there were enough neighbors around to physically block the flatbeds, the police were called and settled everyone down, and the HOA, last heard from in the 1980s, was reestablished in less than a week. It is now an organized and highly efficient group which has made enormous improvements to the appearance and cohesiveness of the neighborhood. But one new homeowner who had bought property weeks before this happened was told he could not build a home for his sister on a second, non-conforming lot included in his purchase. He subsequently sold at a loss and moved on. The manufactured home violated several town restrictions as well as the subdivision covenants, but once in place it is doubtful anything would have been done.
These covenants and restrictions are largely a good thing. They were enacted in the first place to keep communities and neighborhoods attractive and livable (what could be worse than having your new neighbor hauling an engine at 7 a.m. in his make-shift driveway auto repair business). But before you buy, you need to make sure that what you want to do with your property can be done. If you have a plan for immediate changes, even if it seems straightforward, make it a condition of your offer so that you and your attorney have time to check out its permissibility on the site. Make sure your attorney reviews not only town ordinances (a local real estate attorney should know them by heart) but also your deed, any master deed that may apply to your condo or subdivision. As to the HOA that arises like Lazarus, there may be nothing you can do but accept it for its virtues and take the hit.