If you want to become a homeowner but don't want all the responsibilities or space of a detached single-family home, condos and townhomes can be a great choice.
Both options are more affordable than a detached property, and many condos and townhomes have some maintenance duties taken care of by a homeowners association or similar organization. Although the two share some of the same features and price advantages, they have distinct characteristics.
What's the difference?
As an owner of a condo or a townhome, your property is going to be attached to your neighbors' home. The only difference is the boundaries of ownership for each option.
With a condo, you own a unit similar to an apartment. All property within the unit is yours to modify and live in as you please. However, all areas outside the condo, including common areas, fitness centers and the building itself, are the property of the association. This is why there are rules that come with living in a condo, such as whether you can have pets and how much noise is permitted. The benefit is that more maintenance responsibilities are covered because you're not liable to correct problems with the building.
With a townhome, the property resembles a smaller house that is attached to one or more other houses. Rather than stepping out your front door and into a hallway, you can walk directly outside. The HOA may take care of certain tasks, such as community clean up and even your lawn care and snow removal. Repairs that are specific to your property, on the other hand, are typically your job to fix, whether they're on the interior or exterior.
Which option is best?
Selecting between the two types of properties comes down to your personal preferences and tolerance for others telling you what you can do with your home. The tradeoff is that more freedom means more financial responsibility for repairs, which can be costly if you purchase a townhome and need to make roof repairs, for example.
However, complying with additional rules can provide the benefit of more on-site amenities. Plus, those guidelines are in place to help your property value grow, and many homeowners are happy with their HOA. Whichever option you choose, order a home inspection before buying to make sure that your condo or townhome is in tip-top shape.