Restrictive Covenants and MCPs in Victorian Property: What They Restrict and How to Remove Them

Restrictive covenants registered on a Victorian property title can prohibit single-storey replacement, dictate roof colour and material, ban second dwellings, restrict fence heights, or fix the minimum floor area of any future build. They’re registered under section 88 of the Transfer of Land Act 1958, run with the land in perpetuity, and are extraordinarily difficult to remove. About 30% of post-1990 Victorian subdivisions carry one or more.

This guide explains the difference between covenants and Memoranda of Common Provisions (MCPs), the major restriction types, how they affect property value, and the rare circumstances under which they can be modified or removed.

Covenants vs Section 173 vs MCPs — three different things

We covered Section 173 Agreements in our dedicated guide. This article focuses on the other two — covenants and MCPs.

The major covenant types

• Single-dwelling covenant. Restricts the lot to one dwelling. Prevents subdivision, granny flats, and dependent persons units. Eliminates 20–40% of long-term lot value compared to unrestricted equivalents.
• Building materials covenant. Specifies materials (e.g. brick veneer only, no metal cladding, slate-tile roof required). Common in heritage-themed estates.
• Building style covenant. Specifies architectural style (Federation, Edwardian, contemporary). Limits design freedom.
• Roof colour covenant. Restricts roof colour to specified palette — common in newer estates.
• Fence covenant. Specifies fence material, height and colour. Often paired with a no-front-fence covenant.
• Setback covenant. Specifies minimum setbacks stricter than the planning scheme.
• Minimum floor area covenant. Sets a floor of building size — common in upper-bracket estates to prevent smaller homes.
• No commercial use covenant. Restricts the lot to residential use only.

What is an MCP?

A Memorandum of Common Provisions (MCP) is a single registered document containing standard provisions that apply to many lots in a subdivision. Rather than registering identical covenants on every lot, the developer registers the MCP once and the plan of subdivision references it. The lots all share the same restrictions.

MCPs are common in post-2010 master-planned estates — Cardinia Lakes, Berwick Waters, Aurora, Lochiel Park. They typically run 20–40 pages and cover materials, colours, design controls, fences, landscaping, and ongoing maintenance.

How covenants are enforced

Covenants are enforceable by the beneficiaries — typically the owners of nearby lots that benefit from the covenant. Enforcement mechanisms:

1. Direct neighbour action. Other lot owners can apply to the Supreme Court for an injunction preventing breach, or for damages following breach. Costs typically $15,000–$80,000 to defend.
2. Council refusal of permits. Councils generally will not grant a planning permit that contradicts a registered covenant. They check covenants as part of the permit process.
3. Caveat. Beneficiaries can lodge a caveat to prevent transfer or further dealings on a breaching lot.

Removing or varying a covenant

Two pathways exist under section 84 of the Property Law Act 1958 (Vic):

• Court application for removal. Costly ($15k–$50k legal fees), slow (12–24 months), and requires showing the covenant is obsolete or impedes reasonable land use without benefit. Success rate: under 30%.
• Negotiated variation deed. Get all beneficiaries to sign a variation deed. Practically impossible in subdivisions with more than 10 affected lots — a single hold-out kills the variation.

What the Section 32 must disclose

• The full text of any registered covenant affecting the lot
• The MCP if the plan of subdivision references one
• The plan of subdivision showing covenant beneficiaries
• Council planning property report — should reference covenant

Buyer checklist

1. Read every covenant document in full — not just the title-search summary
2. If an MCP is referenced, get the MCP document and read it cover to cover
3. Cross-check the covenant against your plans (renovation, subdivision, second dwelling)
4. Check the planning permit history — has council ever granted permits inconsistent with the covenant?
5. Consider obtaining a solicitor’s opinion on covenant enforceability before bidding on a borderline case

Ready to check your contract? Upload your Section 32 or Contract of Sale at precontractreview.com for a pre-contract check — typically in just a few minutes.