"My neighbour has said that I cannot work from home. Is that right?"

A question which many conveyancers have been asked by their clients in the last eighteen months or so is whether there is anything in the title of the client’s property, or the property that they are buying, which might prevent the client from working at home. Very often the question has been prompted by a remark made by a neighbour!

It goes without saying that this can be of critical importance to the client, particularly if they are relying on being able to work from home in the long term, and/or are contemplating a move to a remote location for a better quality of life.

Potentially the title to a property may contain what is known as a restrictive covenant which might restrict the use of the property, and this is something that the conveyancer will have to check to answer the question.

So what is a “restrictive covenant”?

It is a condition which is created usually at the point that land is sold for development, or when a new property is sold by a developer, which will stipulate what cannot be done on the property. They can be applied to houses and apartments. There will usually be a number of such covenants and they are generally intended to be for the benefit of the land which is retained by the seller. In the case of new housing estates, the covenants may be intended to be for the mutual benefit of the house owners. The way that the covenants are created is usually by way of inclusion in the deed that deals with the transfer of the ownership of the land/house from the seller to the buyer upon completion of the sale. It is important to note that restrictive covenants will run with the land, and so notwithstanding that they will have been entered into by the original buyer with the original seller, they will continue to apply to all future owners of the property.

Typically, the covenants will include a restrictive covenant which states that the property shall not be used “other than as a private dwelling house”, and it is this which has caught the attention of numerous buyers, property owners and even some nosey neighbours!

So will this covenant prevent you from working at home?

If you are not changing the use of the property and are simply using a room to carry out administrative work (working on a computer and telephone calls for instance) that you would otherwise have done in the office, then the chances are that this will not be an issue. If however you are seeing customers, or even work colleagues, or emitting noise from the property, then that could amount to a commercial use and possibly be in breach of the covenant. Alternatively, if you are using part of the property to carry out car repairs, for example, for fee-paying customers then that would certainly amount to a breach of the covenant.

Some restrictive covenants go further and specify that “no trade business or profession shall be carried out on the property and that the property shall only be used as a private dwelling house”. Potentially this prohibits a business owner from basing their business at home although again if it is just a case of using a room in the house, and there are no outward signs of any trading, then hopefully there will be no complaints. On the other hand, a hairdresser, for example, who is using a room to see clients is likely to have problems.

Very often there can be some uncertainty about what does, and what does not, constitute a breach of the covenant. Much of the difficulty is down to the fact that, at the time when most of these covenants were created, home working on the scale that we have seen since March 2020 was not envisaged.

To some extent this uncertainty is being addressed by some developers who are now modifying covenants in new developments so as to provide some clarification as to what activities will not amount to a breach. For example, they may expressly state that a trade or business can be carried on provided that it is just from part of the property, there are never any staff or customers in attendance, it is not noisy, and planning permission for the use is not required. Alternatively, they may state that the use of a room in the property as a “home office” will not be a breach.

What will happen if the nature of your work is such that you might be in breach of the covenant?

Compliance with restrictive covenants is not policed as such. Whether or not compliance will be enforced will depend upon whether those who have the benefit of the covenant decide to take any action. This might include the neighbours. If no-one complains then almost certainly nothing will happen.

It is important to note that restrictive covenants are quite independent of any requirement to obtain planning permission, and so even if there is no covenant which prevents you from working at home you may still need to obtain planning permission. Conversely, even if planning permission is obtained for the use then it might still be prohibited by a restrictive covenant.

Is there any way that the restrictive covenant can be removed? It may be possible to negotiate with whoever has the benefit of the covenant for the covenant to be released, but this may be complicated particularly if it is not certain who does have the benefit. A more practical option might be to investigate the possibility of taking out an indemnity insurance policy to cover the risk of the covenant being enforced against you.

For an initial consultation or quotation regarding advice about restrictive covenants, please contact the Feldon Dunsmore team on 01926 954694.