What is the effect of a restrictive covenant that restricts use of the property to residential purposes?

• A. It restricts use to residential purposes only
• B. It imposes no restrictions on use
• C. It applies only to the seller
• D. It allows commercial use in limited circumstances

Answer: (A)

Restrictive covenants are private land-use promises that attach to the land and bind current and future owners. If a covenant restricts the property to residential purposes, the only permissible use is housing-related activity; non-residential, including commercial, uses are prohibited unless the covenant is varied or released. Because these covenants run with the land, anyone who later owns the property takes subject to the restriction and can be held to it. The nature of this covenant is negative—it's a prohibition on non-residential use rather than a duty to act—and it doesn’t apply only to the seller or permit commercial use in limited circumstances.