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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

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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

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