Condominium vs Townhouse vs Single Family Home
If a condo, a townhouse, and a single family home were to enter a metaphorical boxing ring, perception is the single family home would leave holding the belt every time. So what gives? What makes buyers fearful of the condo and townhome world? Some buyers would say condos and townhomes are harder to sell, especially condominiums. What’s the difference between a condo and townhome, anyway? All good questions. Let’s take a closer look.
In many ways, a condominium and a townhome are very similar. Townhomes generally share a wall or two with a neighboring townhome owner, but each owner has their own entrance. Similarly, condos also share walls and can look indistinguishable to most types of townhomes or apartment buildings. One difference that we sometimes see between a condominium and a townhome, however, has to do with the land on which they sit. In the case of a townhome, the tenant will often own the land and the townhome (but not always). Many times, in the case of a condo, the tenant owns from the sheetrock inward, but the developer or property owner owns the land on which the condominium sits. But when it comes down to it, the difference isn’t visible to the naked eye, as the difference really lies in the legal description. The common misconception is that these are architectural styles when in fact they’re types of ownership.
Herein lies a challenge that we can sometimes see with condos. Because the land is not owned by the tenant, it may be slightly more difficult to find financing for a condo. Additionally, the condominium may have a homeowners’ association (HOA). HOA fees cover the external expenses of lawn care, snow removal, exterior maintenance and other aspects of exterior care, which will add to your monthly mortgage. HOAs are not isolated to condominiums, though. There are neighborhoods of single family homes and townhomes with HOAs as well, so don’t let that be a deterrent.
Knowing the differences between a condominium, townhome, and single family home is the first step toward making the right decision for your situation. Understanding the differences in resale is an important second step. Selling any of the three types of properties truly depends on the market. During a slower market, condos and townhomes may be harder to sell. Just like owning and buying a unique single family home limits the number of buyers interested in the property, condos and townhomes attract a smaller pool of potential buyers; the key is finding the right one. Often condos and townhouses are appealing to buyers who do not have time or interest in managing the exterior care of a property.
Regardless of property-type, resale is always a case-by-case situation. A well-kept property that is priced appropriately is consistently going to attract more interest than one that has not been maintained or is priced too high.This is true of single family homes, condominiums, or townhomes. Each choice you make when purchasing property changes the potential pool of buyers for future resale. For the right person, however, your home may be just the one for them.