Legal Question in Real Estate Law in Indiana

Re: Covenants and restrictions

Due to the manner in which subdivisions are developed today, covenants, whether developed and recorded before or after purchases of lots by prospective homeowners, the covenants are binding. It may be grounds to rescind the sale if the covenants are more restrictive than the general conditions discussed with the developer or seller at the time or purchase.

At some point in time after the development is sold out (or nearly sold out) the homeowners association comes into being and takes over from the original group set up by the developer. This group is free to change and amend the covenants to suit the needs of the community. Any such changes need to be recorded and copies provided to each homeowner to pass along with the original documents as the property changes hands.

The purpose of covenants is a mechanism of self-government for the community. Different developers include different provisions and most are created as a matter of negotiation with the local planning or other regulatory agency for the larger community. It is both a new trens and a not so new trend in community development. Presumptively, the local association will be responsible for some of the services one might expect from the city itself - such as snow removal, a local park, green space, landscaping and a community center. One might consider these amenities in the neighborhood where the larger town you are part of could not supply such services to each smaller area.

Buying very early in a development is risky without knowing what the various architectural styles might be, what the outbuilding restrictions and so forth are. But remember that the developer is concerned about selling off lots and if you tried to sell yours or encourage him to resell it for you, you might be the last one sold.