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Should You Buy a Condo, Townhouse, or House?

Each type of housing has pros and cons—for your bu⭕dget and your lifestyle

By

澳洲幸运5官方开奖结果体彩网:Lisa Goetz

Updated November 08, 2023

Reviewed by Julius Mansa

Fact checked by

Yarilet Perez

Housing choices are abundant, especially in urban areas, leaving many 澳洲幸运5官方开奖结果体彩网:first-time homebuyers wonde𒁃ring which type of residence to buy. Each style of dwelling—condominium, townhouse, and detached home—has its pros and cons. Buyers should consider their lifestyles and budgets, as well as how much they want to be involved in home maintenance when deciding which type of home works best for them.

Key Takeaways

Townhouses, which are generally attached to other residences, are defined by ownership—which includes the land the home is situated on, front and backyard areas, and the home's exterior.
Condominiums provide the most hands-off approach to homeownership and are physically indistinguishable from rental apartments.
Condos are often cheaper than townhouses because they come with no land; the exterior and land are considered common areas shared by all residents.
Condo owners pay monthly homeowner association (HOA) fees that can be significantly higher than those on townhouses, partly because they cover exterior maintenance.
Detached homes often provide owners with the most freedom when it comes to improving the structures or the land that comes with them, but they may lack many of the amenities of condos and townhouses.

What Is a Townhouse?

Less experienced home shoppers may want to know what makes a residence a townhouse. The physical description alone—a narrow, multilevel residence attached to other residences on a street—is not always a clear giveaway because🤪 some areas have condominium communities featuring two- and three-story attached residences.

The defining feature of a townhouse is ownership. Townhouse owners usually own the land on which the house is situated, including any front and backyard area that goes with the residence, no matter how small. They also own their home's exterior.

Additionally, townhouse communities generally have 澳洲幸运5官方开奖结果体彩网:homeowner associations (HOAs). Owners pay monthly dues to cover insurance and maintenance of the community's common areas, as well as for services such as trash pickup and snow removal. Some HOAs enforce community aesthetics rules, such as 🌊the colors of exterior paint permitted and the types of fencing owners can install.

Owners also remain financially responsible for exterior maintenance and repair of their townhouses. A townhouse is right for people who want some involvement when it comes to maint🌄aining theirജ homes but do not want the responsibility of owning and maintaining a large lot.

What Is a Condo?

澳洲幸运5官方开奖结果体彩网:Condominiums provide the most hands-off approach to homeownership. Many of these types of residences are physically indistinguishable from rental apartments, though some developers construct condos that look like multilevel townhouses. Condos are often cheaper than townhouses, in part because they come with no land. The exterior of the units, plus the land around them, is considered a 澳洲幸运5官方开奖结果体彩网:limited common element and owned colle▨ctively by all the condꦇo owners in the community.

Monthly cost and maintenance are the defining features of condos. Like townhouse owners, condo owners pay monthly HOA fees, though their fees may be significantly higher. Condo community HOA fees cover the cost of unit exterior maintenance; the insurance required to cover pricey items such as roofs, elevators, and parking structur🉐es; as well as services like trash and snow removal. A condo works well for people interested in owning real estate at a reasonable price and close to where they work or play.

Condo vs. Townhouse vs. House

Situated on their own lots, detached homes tend to provide owners with the most freedom when it comes to improving the structures or the land that comes with them. The square footage of detached homes ranges f♕rom small to mansion-size, but the defining feature of this type of home is the freestanding structure; there are no neighbors with whom to share walls.

Like condos and townhouses, some detached homes, especially inᩚᩚᩚᩚᩚᩚ⁤⁤⁤⁤ᩚ⁤⁤⁤⁤ᩚ⁤⁤⁤⁤ᩚ𒀱ᩚᩚᩚ urban and suburban areas, may have HOAs, but the fees are usually 💝minimal and cover no more than snow and trash removal and shared road maintenance. And many detached houses have no HOAs at all. Those provide the most independence and freedom of choice.

Detached houses appeal to people who want large yards for their children to play in and room for other structures, such as a detached garage or workshop. Detached homeownership is also the right call for people who do not mind yard work or who yearnꦓ for a big garden.

On the other hand, unless the detached house is part of a community, it may not have some of the 澳洲幸运5官方开奖结果体彩网:amenities that come with many condos and townhouses, such as a swimming pool, fitness club, or tenni�ꦡ�s court.

Condo vs. Townhouse vs. House: Key Differences
	Condominium	Townhouse	Detached House
Initial cost	Often the least expensive housing option	Typically less costly than a detached house	Prices range widely by size and location
Ongoing fees	Monthly dues to homeowner association	Monthly dues to homeowner association	Generally none
What you own	Your individual unit, but not the land or other common areas	Your home plus the land it sits on and possibly a yard	Your house plus the land under and around it
Amenities	Condos often have shared amenities like a swimming pool or fitness club	May also have shared amenities like a swimming pool or fitness club	Amenities depend on what was there when you bought or have since added
Responsibilities	You aren't responsible for mowing the lawn or other upkeep	You aren't responsible for mowing the lawn or other upkeep	Lawn mowing, snow removal, repairs, etc. are your responsibility
Autonomy	An owners association may impose rules you'll be expected to follow	You may also be subject to the rules of an owners association	Unless there's an owners association, you can do as you please within the limits of the law

Who Should Buy What

The decision of whether to 澳洲幸运5官方开奖结果体彩网:buy a townhouse or condo—or to opt for a detached house—usually boils do🅷wn to cost, convenience, and lifestyl♒e.

Millennial-generation buyers with little homeownership experience and no time for home maintenance may benefit the most from starting out in a condo or townho🅷use, upgrading to a detached house only after learning what it takes to keep up a home.

Established buyers who want space for their growing families and those who do not want to be subject to an HOA's rules will benefit the most from buying detached homes.

At the other end of the age spectrum, older adults may benefit from the lower costs♕ and reduced responsibilities of living in a townhouse or condo instead of a detached house. A condo usually requires 💖the least work, leaving owners free to travel and enjoy their leisure time.

What Do I Need to Know Before Buying a House?

There are many factors you need to be aware of before buying a house. These include the price of the home, the 澳洲幸运5官方开奖结果体彩网:down payment needed (usually 20%), your credit score, your likelihood of receiving a mortgage, the property taxes, the make up of the neighborhood (school zone, crime rates, public transport, e🅰tc), and closing costs.

Is Owning Better Than Renting?

Whether owning a home or renting one is better depends on a variety of factors and is specific to each individual. Generally, owning a home is better for wealth creation. Putting your money into a home you own allows you to build equity. There are many benefits that come with building equity, such as the ability to borrow against it, an increase in your net worth, and a profit to be made if your house appreciates. That being said, home ownership comes with lots of responsibilities, such as maintenance and taxes. In that aspect, renting af♏fords flexibility, less responsibility, and lower overall initial costs (there is no need for a large downpayment of 20%).

How Do Interest Rates Affect Home Prices?

Interest rates and home prices have an inverse relationship. Because most people need to take out a mortgage to aff♈ord a house, they will end up paying interest on that loan. When interest rates are high, a borrower will pay more, making the cost of a home more expensive. For this reason, the demand for homes𝐆 decreases when interest rates are high. When demand decreases, the prices of homes also decrease.

The Bottom Line

Buying a home is a big decision for anyone with a lot of factors to consider. Add to that the 澳洲幸运5官方开奖结果体彩网:type of home to buy, and the decision can become even more complex. Whether to buy a condo, townhouse, or house will depend on a variety of factors and be specific to the individual. Take t𒐪he time to 𒉰learn the differences of each, what each would mean to you and your family, and how each would fit into your future plans before you buy.

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