Covenant (Real Estate)

Explore covenants in Canadian real estate — what they are, how they affect property use, and why they’re important for land control.

Covenant (Real Estate)

July 27, 2025


What is a Covenant?

A covenant in real estate is a legally binding promise or restriction placed on a property’s use, typically recorded on title and enforceable by law or contract.

Why a Covenant Matters in Real Estate

In Canadian property law, covenants help regulate land use, protect property value, and maintain community standards.



Types of covenants:
  • Restrictive covenant: limits property use (e.g., no further subdivision)
  • Affirmative covenant: obligates action (e.g., maintain fence)



Covenants run with the land, meaning they bind future owners until removed or modified legally.

Example of a Covenant in Action

The title search revealed a restrictive covenant prohibiting the construction of additional dwellings on the lot.

Key Takeaways

  • Legal promise tied to property use
  • Can restrict or require certain actions
  • Binds current and future owners
  • Recorded on property title
  • May require legal process to change

Related Terms

Additional Terms

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Mortgagee in Possession

A mortgagee in possession is a lender who takes control of a property after borrower default, but before foreclosure or power of sale. The lender. more

Lease Surrender Agreement

A lease surrender agreement is a negotiated contract between a landlord and tenant that ends a lease before its scheduled expiration. Terms may. more

Green Infrastructure

Green infrastructure refers to natural or engineered systems that manage stormwater, reduce heat, and improve sustainability in developments.. more

Escrow Holdback

An escrow holdback is a portion of funds withheld at closing and held in escrow until specific conditions are met, such as completion of repairs,. more

Underused Housing Tax

The Underused Housing Tax (UHT) is a federal annual 1% tax on the value of vacant or underused residential property owned by non-resident,. more

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