Restrictive Covenant Breach When Selling: What to Do
A breach of a restrictive covenant is one of the most common title issues flagged during conveyancing. Here's what counts as a breach, how to fix it, and when indemnity insurance works.
What you need to know
Restrictive covenants are binding promises in property deeds that limit what can be done on the land — no business use, no extensions without consent, single dwelling only, and similar. Breaches are routinely spotted by buyers' solicitors during conveyancing. Four routes to resolution exist: retrospective consent, indemnity insurance, a Lands Chamber discharge application, or sale to a cash buyer. Indemnity insurance is the most common and fastest option, but is only available while the covenant holder has not raised the issue — making early identification before listing critical.
- A restrictive covenant is a binding promise that limits what can be done on the land and runs with the property, binding every subsequent owner.
- Common breaches include unconsented extensions, business use, and alterations done without going through a required consent process.
- Resolution routes: retrospective consent, indemnity insurance, Lands Chamber discharge, or sale to a cash buyer who waives the issue.
- Indemnity insurance (typically £50 to £500) is the most common and fastest option, accepted by most lenders.
- Contacting the covenant holder about the breach can destroy the insurance option — identify issues before listing, not during conveyancing.
Restrictive covenants are one of the most common title issues flagged during residential conveyancing. Unlike lease issues, which only affect leasehold properties, restrictive covenants can appear on any registered title — freehold or leasehold. And unlike planning breaches, which are governed by public law and have limitation periods, restrictive covenant breaches are governed by private law and have no statute of limitations: a covenant breached 50 years ago is still technically enforceable today.
The good news is that the routes to resolution are well established and usually quick. The bad news is that the single most common mistake sellers make — contacting the covenant holder themselves to ask about consent — can destroy the cheapest route. This guide covers what to do and what not to do.
This is a sub-guide within our title defects pillar.
What is a restrictive covenant?
A restrictive covenant is a binding promise in a deed that limits what can be done on the land. It is imposed by one landowner on another, usually when land is first sold off by a developer or estate. The covenant is then recorded in the title register under the Charges Register section and binds not just the person who originally made the promise but every subsequent owner, subject only to:
- The covenant being properly worded
- The covenant having a beneficiary (someone entitled to enforce it)
- The benefit of the covenant being transmissible (the doctrine of annexation or building schemes)
Common restrictive covenants on UK residential property include:
- No business use. The property must be used as a private dwelling only.
- No extensions or alterations without consent. Any structural change requires the written approval of the covenant holder.
- Single dwelling covenant. The property cannot be subdivided into flats or separate units.
- No trading vehicles parked overnight. A restriction commonly found on estate developments.
- Restrictions on materials or aesthetic changes. Covenants requiring approval of external paint colours, fencing types, or roofing materials.
- Restrictions on keeping animals. Particularly common in leasehold flats.
How breaches are spotted
The buyer’s solicitor reviews the title register during conveyancing and sees the covenants listed in the Charges Register. They then cross-check against:
- The physical property (as reported in the survey or estate agent’s details)
- The TA6 Property Information Form answers
- Planning records and building regulations approval documents
- Any licences or consents the seller provides
Where there is a mismatch — for example, the title says no extensions without consent, the property has an extension, and the seller has no consent document — a breach is identified and an enquiry is raised.
The four routes to resolution
Route 1: Retrospective consent
Where the covenant holder is identifiable, contactable, and willing, you can apply for retrospective consent. The holder may charge a premium and will usually ask their solicitor to draft a formal deed of consent. Timeline: two to six weeks. Cost: a few hundred to a few thousand pounds depending on the covenant holder’s position.
Important: contacting the covenant holder closes off the indemnity insurance route. Do not make this approach without taking advice first.
Route 2: Indemnity insurance
This is the most common route. The seller (or sometimes the buyer) buys a one-off indemnity insurance policy covering the risk that the covenant holder might one day bring enforcement proceedings. The policy pays the insured party’s losses if enforcement happens, including the cost of modifying or removing the offending structure, legal costs, and any compensation ordered by the court.
Indemnity insurance is available only where:
- The covenant holder has not raised the breach.
- The breach has existed for a reasonable period of time (often 12 months or more, depending on insurer).
- No enforcement correspondence has been sent or received.
Premiums typically range from £50 to £500 for residential properties. For a full breakdown of who pays, see our guide to indemnity insurance: who pays?
Route 3: Lands Chamber application
Under section 84 of the Law of Property Act 1925, the Lands Chamber of the Upper Tribunal has power to discharge or modify restrictive covenants that have become obsolete, impede reasonable use of the land, or cause no practical benefit to the person with the right to enforce them. Applications take six to twelve months and cost several thousand pounds in tribunal and legal fees.
This route is worth considering where the breach is substantial, indemnity insurance is unavailable, and the covenant itself is outdated. For most residential breaches, indemnity insurance is faster and cheaper.
Route 4: Sell to a cash buyer
A cash buyer without a mortgage lender to satisfy can accept the breach on a “buyer beware” basis, usually with a price reduction reflecting the risk. This is a last resort — the price reduction often exceeds the cost of indemnity insurance or Lands Chamber discharge — but it can be the right answer where the property is being sold at auction, or where other factors rule out insurance.
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What to do before contacting anyone
Because contacting the covenant holder destroys the insurance route, the order of steps matters:
- Check your title register for any restrictive covenants. Order official copies from HM Land Registry (£3 each).
- Review the covenants against the physical property and any changes you have made. Your solicitor can help.
- Identify any potential breach. Does an extension or alteration contravene a covenant? Has the property been used for business?
- Decide on the resolution route before contacting the covenant holder. If indemnity insurance is the intended route, do not contact the holder.
- Obtain an indemnity insurance quote through your solicitor. The quote will confirm availability and price.
- Disclose the breach and proposed resolution in your offer pack and on the TA6.
Getting these steps in the right order is the single most important thing a seller can do to manage a covenant breach.
Common scenarios and recommended routes
| Scenario | Recommended route | Typical timeline |
|---|---|---|
| Extension built without covenant consent, 10+ years ago, no enforcement activity | Indemnity insurance | 2 to 5 days |
| Recent extension, covenant holder is an active estate company | Retrospective consent | 2 to 6 weeks |
| Historic loft conversion, covenant holder is a long-dissolved developer | Indemnity insurance | 2 to 5 days |
| Business use of a domestic property | Cease business use + indemnity insurance | Variable |
| Covenant holder has sent an enforcement letter | Negotiate retrospective consent or Lands Chamber discharge | 6 weeks to 12 months |
What sellers should disclose on the TA6
Question 4 of the TA6 Property Information Form (6th edition) asks about disputes and complaints, alterations, and consents for alterations. Where a covenant breach exists, you must disclose it honestly. Concealing a known breach is misrepresentation. Where indemnity insurance has been arranged, disclosing the breach alongside the policy reassures the buyer and their solicitor.
See our wider coverage of enquiry practice in our guide to answering buyer enquiries.
Costs summary
- Indemnity insurance: £50 to £500 one-off
- Retrospective consent fee from covenant holder: £200 to £3,000 typically
- Lands Chamber discharge application: £3,000 to £8,000 in tribunal and legal fees
- Cash buyer price reduction: 2% to 10% of sale price typically
Sources and further reading
- HM Land Registry — Title register, restrictive covenants, and official copies (gov.uk/government/organisations/land-registry)
- Law of Property Act 1925, section 84 — Discharge and modification of restrictive covenants (legislation.gov.uk)
- Upper Tribunal (Lands Chamber) — Jurisdiction over covenant discharge (gov.uk/courts-tribunals/upper-tribunal-lands-chamber)
- UK Finance Lenders’ Handbook — Lender requirements on indemnity insurance (cml.org.uk/lenders-handbook)
- Law Society — Conveyancing protocol and TA6 guidance (lawsociety.org.uk)
Related guides
- Title Defects When Selling: Pillar Guide
- Indemnity Insurance: Who Pays?
- Search Indemnity Insurance Explained
- Land Registry Title Check Before Selling
- Boundary Disputes When Selling
- Why Do House Sales Fall Through?
Frequently asked questions
What is a restrictive covenant?
A restrictive covenant is a binding promise in a property deed that limits what can be done on the land. Typical examples include restrictions on business use, a prohibition on extensions without consent, a requirement to use the property as a single dwelling only, or a ban on trading vehicles being parked overnight. The covenant is usually given in favour of the original landowner (often a developer or estate) and runs with the land, meaning it binds every subsequent owner.
How would I know if my property is subject to restrictive covenants?
Your registered title at HM Land Registry will list any restrictive covenants in the Charges Register (the C section of the title register). The covenants themselves may be set out in full in the register or referred to by reference to an earlier deed. Ordering official copies for £3 each and reading the Charges Register is the starting point. Your solicitor will interpret the covenants and identify any that may have been breached.
I extended my house without getting covenant consent — is that a breach?
If the covenant restricts extensions or alterations without the covenant holder’s consent, and you did not obtain consent, then yes it is a breach. Breach does not make the extension illegal in a planning sense (planning consent is a separate regime), but it does give the covenant holder a potential cause of action. In practice, most covenants have specific holders (the original developer, an estate company, a neighbouring owner) and whether enforcement is likely depends on their interest and awareness.
How do buyers’ solicitors pick up covenant breaches?
The buyer’s solicitor reads the title register, sees the restrictive covenants listed there, and checks them against the physical property, the TA6 Property Information Form, and any planning or building regulations records. If the covenant requires consent for extensions and the property has an extension, they ask whether consent was obtained. If no consent is forthcoming, a breach is identified. This is a routine part of conveyancing and the buyer’s solicitor is expected to raise it with their client.
What are my options if a breach is found?
There are four main options. First, obtain retrospective consent from the covenant holder — if they exist, can be identified, and agree. Second, take out indemnity insurance to cover the risk of enforcement (the most common practical route). Third, apply to the Lands Chamber of the Upper Tribunal for a discharge or modification of the covenant under section 84 of the Law of Property Act 1925 (slow and more expensive). Fourth, accept that the sale may need to proceed to a cash buyer who is willing to take the risk without a mortgage.
How much does covenant breach indemnity insurance cost?
Premiums range from £50 to £500 for most residential properties, depending on the nature of the breach, the value of the property, and the risk of enforcement. The insurance is a one-off cost, not an annual premium, and the policy passes with the property to any future owner. For more substantial breaches or higher-value properties, premiums can run into the low thousands. Your solicitor will obtain a quote from a specialist insurer (Legal & General, Countrywide Legal Indemnities, CLS Property Insight, or similar).
Will a mortgage lender accept indemnity insurance for a covenant breach?
In most cases, yes. Major UK lenders including Halifax, Nationwide, Santander, NatWest, Barclays and HSBC all accept properly worded indemnity policies for restrictive covenant breaches. The policy must meet the specific wording requirements in the UK Finance Lenders’ Handbook, which is why your solicitor will request it rather than buying it off the shelf. A small number of lenders have more restrictive policies, particularly for unusual covenants, so the buyer’s solicitor will always check the specific handbook entry.
Can indemnity insurance be used if the covenant holder already knows about the breach?
No. Indemnity insurance is only available for latent risks — situations where the covenant holder has not yet raised or threatened enforcement. Once a breach has been flagged to the covenant holder, contact made, or a letter sent, most insurers will refuse cover. This is one of the practical reasons why sellers should identify covenant breaches before listing rather than during conveyancing: contacting the covenant holder to ask about consent can inadvertently destroy the insurance option.
How long does it take to arrange retrospective consent from the covenant holder?
If the covenant holder is identifiable, responsive and willing to consent, the process can be completed in two to six weeks. In practice, the covenant holder is often a defunct developer, a long-dissolved company, or an absent estate owner, in which case retrospective consent is not realistically available and indemnity insurance becomes the only practical route. Where consent is negotiated, the covenant holder may charge a premium — typically a few hundred to a few thousand pounds depending on the nature of the breach.
What is the difference between a restrictive covenant and a restriction on the title?
A restrictive covenant is a substantive rule about what can be done on the land. A restriction on the title is an administrative entry in the Proprietorship Register that requires certain conditions to be met before the property can be transferred (for example, the consent of a third party). The two are often related — a covenant may be backed by a restriction requiring the covenant holder’s consent to any sale — but they are separate legal concepts with separate remedies. Your solicitor will identify both during the title check.
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- →Why Do House Sales Fall Through? (And How to Prevent It)
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