The owner has exclusive use of a given area, typically a unit. Homeowners Associations: Should Real Estate Investors Join or Pass? Buying a Condo to Rent Out? Responsibilities when owning a townhouse When owning a townhouse, the owner is responsible for the exterior of the home and the land around it. Condo vs. Townhouse: Difference and Comparison Condos and townhouses are two of the hottest real-estate items on the market today. Condo owners only own the interior of their unit. Condo owners often pay higher monthly maintenance fees, which go toward exterior and community space repairs. Although condos come in many sizes and styles, they are generally smaller than townhouses. Townhomes, which are generally multilevel residents attached to other residences, are defined by ownership—which includes the land the home is situated on, front- and backyard areas, and exterior. All other areas, including the building exterior, lawn and communal areas, are property of the Homeowners Association (HOA). There are potential drawbacks with condo and townhouse living, however. Where Do You Find the Condos for Sale to Buy as Investment Properties? Some also find the restrictive nature of an HOA frustrating, wishing instead that they could do more of what they would like without having to consult neighbors (in which case a detached home that isn't connected to an HOA is the best solution). Condo townhouse: a townhouse that’s part of a condo development. Buying a rental property gets especially confusing when choosing between almost similar properties such as a condo vs townhouse. Condos, for instance, are by definition individually-owned apartments that can sometimes be rented. Others HOAs are large, have high fees, and maintain a multitude of rules, issues, and features both big and small. Most have a small backyard and frontyard. Millennial-generation buyers with little homeownership experience and no time for home maintenance may benefit the most from starting out in a condo or townhouse, upgrading to a detached house only after learning what it takes to keep up a home. Landlords pay less in townhouse fees since they are responsible for most of their upkeep and maintenance. As with HOA fees, townhouse owners typically have lower monthly maintenance fees, but pay more out of pocket for exterior and interior care. What makes an apartment a condo is the fact that someone can own the interior space of that apartment and jointly-own the spaces outside of it (e.g., halls, exercise rooms, parking lots or garages, pools, the building's roof). The shared spaces in townhouse communities are often much smaller, compared to that of a condo. For example, what is the difference between a condo and an apartment? Which would make for the best real estate investment? Gentrification refers to the transformation of a city neighborhood from low to high value, often leading to the displacement of its previous occupants. You can typically gain access to the first floor and they tend to lack a dedicated security person (though there can be one occasionally patrolling the neighbourhood). What’s interesting about the condo vs. townhouse comparison is that their physical features are not really what set them apart. A homeowner association (HOA) — sometimes called a condo association — is a corporate body with an elected executive board that manages and maintains standards and amenities within a complex or neighborhood. Situated on their own lots, detached homes often provide owners with the most freedom when it comes to improving the structures or the land that comes with them. Moreover, condos appreciate more slowly than townhouses or detached homes that are more suitable for families, so it may be some years before a condo gives a good return on investment — if it ever does. If you are looking for professional support when buying a condo / townhouse or searching for rental, our real estate specialists will be delighted to support you along this journey. Now we cannot even get financing on our places because they are supposedly condos with no HOA. Condos tend to be better for singles or couples, whereas townhouses tend to be better for families. HOAs take in monthly or annual fees and have community meetings where homeowners they cover attend and make decisions regarding the complex or neighborhood. For many first-time homebuyers, a condo and townhouse are good starter homes. Townhouses may have higher home insurance rates, since most owners need insurance that covers both the exterior and interior. Detached-home ownership is also the right call for people who do not mind yard work or yearn for a big garden. A townhouse is not an apartment, but a house built within a row of connected houses. https://www.nationwide.com/personal/insurance/renters/, https://www.nationwide.com/personal/insurance/homeowners/, https://www.nationwide.com/renting-a-condo-tips.jsp, https://blog.nationwide.com/condo-vs-co-op/. Called the condominium association, responsible for day to day maintenance of building and exteriors and common areas. If you’re thinking of buying or renting a townhouse or condominium, there are some important differences between the two that you should know about. Condos tend to have joint underground-style parking, while townhouses may or may not have dedicated parking under them. Best Type of Investment Property: Multi-Family Home! Condominiums often have a community focus with a club house, pool, golf course and/or similar amenity. This can be a pain if the elevators ever breakdown or the power goes off. They could be part of a group of cottages, a large high rise or anything in between. US Home Prices Expected to Fall 6.6% by... How to Calculate the Rate of Return on a Rental Property. Townhouses can be quite large and often feature multiple stories. Townhouses often require a lot more self-maintenance or the private hiring of professionals to fix problems that eventually arise. this is a link to toggle the menu off and on, Tips for Traveling on North America’s Most Scenic Train Trips, 16 Tips for How to Be Happy at Work [Video], How to Get the Most Financial Aid for College. Just to clarify things, when we say condo, we mean a condo unit that’s owed by a separate condo owner with a condo corporation managing the building. A townhouse is a style of housing where a row of independent and identical houses share walls. This can be a pain if the elevators ever breakdown or the power goes off. Depending on where it is in the row, a townhouse shares one or two walls with the other homes. Here is the accurate and simple explanation of the two terms. So, which is better? You have to pay condo or homeowner association fees. Both have condo fees and a condominium corporation. However, there are some common rules and regulations among most HOAs. Meanwhile, a townhouse tends to have more space. They may be part of a large high rise, a cul-de-sac of cottages or anything in between. Though townhouses share one or two walls, they are considered individual and independent homes, usually with individual yards (that may be fenced) and carports/garages. This means the costs associated with the HOA are significantly lower than with a condominium. You state that a townhouse is a single family house sharing common walls and you own the interiors and lot. Can I Remove This Mandatory Partners Link? I thought you also owned the structure ie the house including the roof. When it comes to condos, they are an excellent option for those who prefer the busy city lifestyle. You’ll need to make the most of every square inch e.g. Similarly, having a small yard in which to sit or garden in is a townhouse selling point for those who want some features of a traditional detached home but still want a more urban living experience. And at the other end of the age spectrum, Boomers may benefit from the lower costs and reduced responsibilities of living in a townhouse or condo instead of a detached house. He loves writing on topics that help real estate investors and agents make better choices. Freehold townhouse: a standalone property from a legal perspective. What’s the Best Airbnb Analytics Platform for 2019? Now that we understand the basic difference between a condo and townhouse, let’s take a look at the 12 key differences to know. Townhouses are designed in rows, so tenants usually share at least one wall. Condos generally have higher HOA fees and are smaller, while townhouses have lower HOA fees are built with more square footage. Also elevator waiting times can be very long, especially during the rush hours in the morning. A condo is a housing structure that is a part of a bigger unit or building. Owners pay monthly dues covering insurance and maintenance of the community’s common areas, as well as trash pickup and snow removal. Federal Housing Administration (FHA) Loan. Condos are generally on the more expensive side with more active resident communities while townhouses are a little more low-key, though offer a living experience much more similar to that of a single-family home. In terms of privacy, condos and townhouses may or may not seem private. Overall, the main differences between a townhouse and a condo boil down to the type of community you want, your desire to being a homeowner and if you want HOA fees. Though these spaces are not large, a private outdoor area is advantageous for those with small children or … Differences Between a Condo and a Condo Townhouse.