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.
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
Average and median describe different aspects of the same month’s transactions. Both are affected by the mix of homes sold.
Category averages compare different homes and locations; the gaps are not estimates of the cost to upgrade an otherwise identical property.
The five categories shown account for 5,000 of the board’s 5,057 sales. The remaining 57 transactions were in other housing categories.
Monthly observations are not seasonally adjusted. Active listings count properties available at month-end; they are not construction inventory.
Average and median prices share one dollar axis. These unadjusted transaction measures do not control for changes in the homes sold.
TRREB’s 416/905 categories compare the apartments sold in each area. The difference does not isolate a location premium for equivalent units.
5680 Oak Street in Vancouver and its surrounding context. (MCMP Architects)
Ground-level renderings of the tower proposed for 5680 Oak Street in Vancouver. (MCMP Architects)
