Private Restrictions on Ownership

Private restrictions are created by private entities such as land developers rather than public agencies and usually constitute both a benefit and a burden to the land. Private restrictions are considered a benefit when the landowner has a right of enforcement against other landowners; however, they are considered to be a burden when they restrict the use the landowner may make of the land. Examples of some private restrictions are Covenants, Conditions, and Restrictions (CC&Rs), liens, and encroachments. CCRs are private encumbrances that limit the way a property owner can use their property, such as deed restrictions. An example would be not allowing homeowners to keep horses on their property. A lien is a form of security interest granted over property to secure the payment of a debt or performance of some other obligation. The owner of the property, who grants the lien, is referred to as the lienor, and the person who has the benefit of the lien is referred to as the lienee. One of the most common types of liens is a mortgage, which is a consensual lien.This means that a borrower agrees to give up ownership of the property to the lender if the borrower does not make his or her payments. Other common liens are tax liens, construction liens, and judgements liens, among others. Different types of liens hold different priorities, meaning there is an order to which the liens are handled. Below is a link to a video regarding property liens:

http://www.youtube.com/watch?v=NPzPmBOJD1k

An encroachment is an intrusion on another person's property. Examples of encroachments would be if your fence crossed your neighbor's property line or if part of your pool was built on your neighbor's land. Encroachments are often caused by surveyor error in placing the pins marking the boundaries in a subdivision. Many people don't know about the existence of an encroachment on their property until a survey is done, they try to sell their home, or are approached by a neighbor. Below is a link to a video with an example of an encroachment:


http://www.youtube.com/watch?v=6-hIM7F1D4o

Private restrictions can greatly affect real estate owners. It is very important to be aware of all restrictions that are applicable to a piece of property before purchasing it. Referring back to my example earlier regarding deed restrictions, if your family rides and owns horses and would like to house them on your property, you must find a neighborhood who's deed restrictions allow horses. Also in the case of encroachments, if your neighbor's fence was built on your land, that essentially takes away from your acreage and decreases the value of your property.