Over the last few years, there has been significant population growth in the greater Triangle area. Home options have increased, and many people are wondering if it would be smart to buy a townhouse or a condo instead of a single family home.
The terms townhouse and condo are used frequently to describe housing options, but many people are confused by what the terms actually mean. Triangle area buyers are also not sure if it’s a better idea to buy a condo or a townhouse, or if they need to avoid both options altogether.
The terms “Townhouse” and “Condo” does not describe the architectural style
One important thing to understand is that the architectural style of the housing unit does not determine whether it is a townhouse or a condo. Both types of property have collective rules and both types share common areas. They also can be designed in many different configurations.
Some people assume that if the homeowner has an outside entrance to their unit, or it is a multi-story home then it should be a townhouse. If the home is one floor, or if it shares a hall with another unit, then it’s a condo. This sounds logical, but it’s definitely not true. I’ve personally owned a two-story condo that had a separate entrance.
As you will see, the real way to figure out if a unit is a townhouse or a condo is associated with ownership rather than architecture. To determine if a home is a condo or a townhouse you will need to know how much an owner is responsible for in regard to their unit.
Ownership style is determined before units are built
Below we are going to break down some information about both townhouses and condos. Hopefully, this will help explain where they are similar and how they differ.
Neighborhoods are frequently designed to offer some benefits to the owners in the community. There are rules about how the community is managed, how it will look, and what the homeowners will be responsible for.
The way a developer decides to set up the development will determine if the homes are considered single-family houses, townhouses or condos.
What is a townhouse?
Townhouses are often rows of uniform homes, and they can range in sizes from one story to multi-story buildings. An individual townhouse or townhome is a single family residence that shares walls with other independently-owned units.
When you buy a townhouse you will own the interior and exterior walls, frequently the roof over your unit, and even a small lawn. When you purchase homeowner insurance you’ll need coverage for the unit and your small parcel of land.
Residents of the townhouse community will pay monthly fees to the Homeowners Association (HOA). These HOA fees go toward maintenance of the common areas and for other amenities if they are available.
So, with a townhome, you own the interior, the exterior and some land.
What is a condo?
Condos can vary in size or style ranging from individual homes to high-rises, but they often share walls with adjacent units. A condominium community is usually a building with separate units owned by individual residents. Owners may share a hall with other owners, but they also may have individual exterior entrances.
Condo owners do not own any land and they usually don’t own the roof or the exterior structure either. They own and maintain the interior of their own unit but don’t own the property on which it sits. The exterior, lawn, and shared spaces are owned and maintained by the Homeowners Association or HOA.
Condos are great options if a buyer doesn’t want to worry about maintenance. As a condo owner, you are only responsible for the interior of your unit.
Since the homeowner’s exposure to maintenance issues is reduced the condo owner should see a decrease in their homeowner’s insurance.
Easy way to remember the difference between a townhouse and a condo
To understand the difference between these options just remember that townhouse owners are responsible for more upkeep and they also have some land ownership. Condo owners, on the other hand, own the interior of their unit and that’s it. They usually don’t have to worry about the upkeep of the exterior at all as that is handled by the HOA.
How are homeowner fees determined?
Residents in these communities almost always pay monthly homeowner fees. This money is managed by a homeowner’s association (HOA). Maintenance of common areas, upkeep of items that belong to the community, and even some insurance will be paid from these monthly fees.
The homeowner association (HOA) takes on responsibility for more of the maintenance and upkeep for condos. Since the HOA is responsible for more items in a condo development you’ll usually see higher HOA fees when you live in a condo. This extra expense might be offset a little by a reduction in homeowner insurance. Condo owners pay significantly less in homeowners insurance since they aren’t responsible for the exterior of the building or the land where it sits.
What should you expect for townhouse and condo HOA fees if you live in Wake or Johnston County?
The townhouse or condo communities fees in the greater Triangle area could run from $50 to over $500 a month. It’s always best to check with each community to see what the fee is, and what that fee will cover. That information will be listed on the advertisements on the Multiple Listing Service. Sellers will also provide more information when they fill out their mandatory North Carolina property disclosure forms.
As would be expected, the community that offers more amenities usually has a higher fee. So if there’s a clubhouse, pool or other major attractions you may get charged higher HOA fees.
If you live in a townhouse or a condo it is important to know that these HOA fees are mandatory. If you fail to pay them the association could put a lien on the unit. You are violating deed restrictions if you fail to pay, so the HOA could also petition to take your unit. People have lost their homes when they refused to pay HOA fees. Buyers should be certain that they’re comfortable with these fees when you’re figuring out whether a particular home fits their budget.
What are the benefits of living in the townhouse or condo communities?
Benefits of townhouses and condos
- Owners don’t have to fret about maintenance, and they will have smaller yards or no outside lawn care at all.
- These developments are usually found in areas with greater population density so the commute to work should be decreased.
- Frequently perks like a neighborhood pool, tennis, park, clubhouse or other amenities are offered to the residents.
- Condos and townhouses can frequently cost less than a single family home.
- They offer a great option to live close to others so they provide more opportunities for interaction with neighbors.
- All homeowners abide by the same rules so there is a uniform standard to the aesthetic of these communities.
Downsides of living in townhouse or condo communities
- You will be living close to your neighbors. This is great if the neighbors are fine, but will be annoying if your neighbors are troublesome.
- You must abide by the community rules and regulations. Many people like the idea of a uniform aesthetic in the community but they are upset when they personally want to “do their own thing.”
- Association fees will be ongoing. Even when you pay off your mortgage, you’ll still be responsible for these fees.
- Depending on the location, many buyers prefer to purchase single-family homes. When you sell, you may find that the resale values and time on the market may be different than if you owned a single family home.
Important things to keep in mind when you purchase a townhouse or a condo
- Pay attention to the fees associated with the community. Make sure that this extra cost will fit in your budget. Focus on the overall payment that you qualify for, not just the limit for your buying power. A townhome or condo will have reduced bills for homeowner insurance, but they’ll also add ongoing fees for the HOA. This could change the amount you qualify for if the HOA fees are substantial. Double check this before you put in an offer.
- Read the rules and regulations of the community and make sure that you are comfortable with these rules.
- Make sure to do a home inspection of the unit so you can be sure that everything is in working order. Home inspectors usually charge less for these inspections so it’s just a wise thing to do.
- Check in with your lender before purchasing a townhouse or a condo. Many lenders have some restrictions or items that you need to find out for loans in condo or townhouse communities. For example, some lenders may want the homeowner’s association to show that they have a certain level of financial reserves in case they need to do large scale maintenance.
Townhouse or Condo Owner Demographics
Buyers will choose these lifestyle options for many reasons. Townhouse or condo owners are less worried about maintenance. They have opportunities to interact with neighbors. Finally, these communities are also located close to work and shopping so that can make life easier.
Condo or townhouse ownership is a fabulous option for the person who travels frequently or those of us who are not interested in spending our downtime on exterior maintenance such as lawn care.
The condo or townhouse lifestyle is also perfect for people who are downsizing (see the article about Downsizing in the Triangle here) because it offers a community lifestyle while reducing maintenance issues.
Lastly, townhouses and condo units are perfect for the first time homeowners. They offer buyers an opportunity to purchase their own place even if they can’t afford the higher cost of purchasing a single family home.
Search for Townhouse and Condo Developments in our area
If you decide that you are interested in buying a townhouse or a condo in the greater Triangle area, you’ll have lots of options to chose from.
Click on the links below and you can see homes on the market in Wake and Johnston Counties. You can also sort these based on price. If you are interested in searching in a particular town or by other options then go directly to www.TriangleTrusted.com and you can set up a more specific home search.
You can also see what townhouse and condo options are available in the Harnett County market by searching here:
Lastly, if you need any other assistance or have questions, make sure to reach out to Triangle Trusted Realty, Inc. You can call them at (919) 481-4914. Or feel free to complete this form and they will reach out to you.