If you’re confused about the differences between condos and townhomes you’re not alone. The common conception is that a condo is one floor and a townhouse is two. But, that is not correct. In fact, the amount of space and stories has nothing to do with a home being classified as a townhouse or a condominium. So, if it’s not the floor plan, what is the difference?
Simply put, when you purchase a condo you are purchasing a block of air and when you purchase a townhouse you are also purchasing a bit of land with the structure. That’s why you can purchase a two-story condo or a one-story townhome. Traditionally, most townhomes were two floors, likely causing the misconception, but ranch style townhomes are becoming more and more popular.
Similarities Between Condos and Townhomes
Both a townhouse and condo have common areas that are taken care of by a community management company or property owners association (POA). There are also usually amenities such as a pool, fitness center, walking trails, and more shared by the neighborhood. Both may have a regime fee or property owners association fee and some have both. Communities with single family dwellings and townhomes are more likely to have both fees. The regime fee (takes care of the condo or townhouse exterior) and the POA fee takes care of the common areas shared by everyone that lives in that community. If the complex is only townhomes or condos then you will most likely only have one fee shared by all.
Both townhomes and condos are in high demand and usually sell quickly making them a perfect transition property.
What Does the Regime or POA Fee Cover?
The community (as in the complex) determines what is covered by the fees. For a condo, everything from the walls out is covered by the fee which means all outside maintenance, including power washing, landscaping, roofs, windows, and outside pest control are taken care of by the management company. The fee also usually covers water, sewer, and trash removal as well. The fees can also cover the same things in a townhome but each townhouse community is different so it’s important to know what is covered by the association if you are purchasing a townhome. Some townhomes only cover landscaping and lawn care while others are all-inclusive. The amount of the fee is usually a good indicator of what’s covered.
Differences Between Condos and Townhomes
The differences are in the ownership itself. As stated earlier, a condo is basically the purchase of a block of air. It is deeded as a unit in a Villa Master Recording. You own everything walls in but do not own any portion of the building or grounds. A townhouse is a fee simple property which means you own your unit in the building and a portion of the land. You may have shared walls with another townhome, but the home transfers in the exact same manner as a detached single family home.
Advantages and Disadvantages of Owning a Condominium
The biggest advantage is no outside maintenance. In the event of damage to a building, you are never responsible for any repairs to the exterior of the building. The management company is responsible for the roof, gutters, and windows should there be damage. However, you are responsible for major components such as the HVAC system or if your plumbing springs a leak.
Many times condos on the market have been completely upgraded with wood flooring, granite countertops, and stainless steel appliances. Since the price of a condo is significantly less when compared to a single family home, these units can be very attractive to a buyer on a tight budget.
A disadvantage is that you may be very limited in regards to outside use since you do not own any portion of land outside of your unit.
Advantages and Disadvantages of Owning a Townhome
One of the biggest advantages of owning a townhome is the outside maintenance that is included with ownership. The yard itself can also be a huge advantage. Some townhomes have a large enough yard to fence it in or to create a private outside living area. Townhomes also have a higher level of ownership when compared to a condominium.
A disadvantage is the smaller yard but some may call this an advantage.
Both townhomes and condos are great properties. They are often most attractive as a second home or for anyone that does not want to worry about outside maintenance. Both are also great investment properties. Many buyers purchase them while in transition and then use them down the road as an investment property.