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What effect does a deed restriction have on a property?

On Behalf of | Oct 8, 2019 | real estate transactions | 0 comments

Before purchasing real estate property in Michigan, you may wish to verify that there are no existing deed restrictions in place regarding what you can or cannot do once the sale goes through. A previous owner may have added a specific rule to the deed, such as prohibiting a mobile home or a vegetable farm on the parcel of land under consideration. While restrictions may have been added at some point in time to help maintain the property’s market value, factors are always changing, and it may require you to work out an arrangement to update a deed with the seller.

Finding out about prohibited activities or uses ahead of time may help in determining whether a particular property can actually accomplish your intended plans. As reported by MLive Media Group, a deed restriction prohibiting residential real estate development on a site has held back plans to revitalize a Michigan neighborhood.

A commercial developer based in Ann Arbor purchased the blighted 2.5-acre Brownfield lot, which includes a factory building and has been an eyesore in the neighborhood for more than a decade. The developer sought to demolish the vacant factory and reconstruct the site as a mixed-use enterprise. A deed restriction, however, prevented him from moving forward with his plans.

Once there is a restriction recorded on a deed, you must abide by it when you become the new owner. If you do not take the required legal steps to have an unwanted restriction removed, you may get stuck with a property that does not serve your intended purposes.

This information is provided for educational purposes, and should not be interpreted as legal advice.