1. Single Family Homes
By far the most common form of housing, the most important distinguishing factors that determine a single family residence are that it sits on its own piece of land and it is not attached to anyone else's residence. Restrictions about what you can do with your property are primarily dictated by the city in which you live, but for the most part you can do with it as you wish. You will probably have a yard of some sort-from very small up to multiple acres-and your ownership will include all of it.
Advantages of a SFR
- You can modify or improve it as you wish
- Re-sale value is generally the highest on a single family home
- You can add on to the existing home if more room is needed
- Generally there are no property management fees as there are in condo and many townhouses
Disadvantages of a SFR
- All maintenance and repair costs are your responsibility including electricity, gas, water, sewer and trash removal
- Lack of amenities (for example, community pools, gym, playgrounds, etc.) that you may find in a condo or townhouse
- You are responsible for upkeep and landscaping
- In most areas, SFRs are more expensive
Is a Single Family Residence the Right Fit for You?
You like your own "space"
You like modifying your home, making it your own-changing the color, the appearance, the size.
You like the idea of maintaining your own lawn, and the home's surroundings
You like the idea of being able to build your house
2. Townhouses
A townhouse is a home that is attached to one or more other houses, but which sits directly on a parcel of land that you also own (if you don't own the land, it is a condominium). Townhouses can ranges from duplexes and triplexes all the way through huge townhouse communities consisting of hundreds of similar homes. Townhouses to some degree offer attributes of both SFRs and condominiums.
There is a good degree of variance in the way townhouse communities are structured. It may be a simple agreement (as is often the case of duplexes and triplexes) that each parcel of land and the home that sits on it is separately owned. In the case of larger townhouse communities, you will generally have an additional shared ownership in the common areas of the complex as well as any amenities such as swimming pools, park areas, etc. This ownership you will share jointly with all other townhouse owners in the complex.
In any townhouse purchase that involves an Homeowners' Association, it is critically important to get as much information as you can, since the association can have a considerable impact on your ownership experience! (we'll explore Homeowners' Associations in a later post)
Advantages of a Townhouse
- Less exterior maintenance and repairs
- There may be amenities in the community such as pools, tennis courts, playground, etc.
- Sharing common walls with neighbors may bring a greater sense of security
Disadvantages of a Townhouse
- You are responsible for Home Owner's Association fees (which cover common areas and other "perks" of community living)
- Your options for changing the exterior look of your house will be limited
- Sharing common walls with your neighbors, you give up privacy as compared to SFRs
Is a Townhouse the Right Fit for You?
You like your own "space" but not having to deal with all of the exterior maintenance
You don't mind having neighbors close to you.
You like the idea of a small yard
3. Condominiums
Condominium ownership is basically an apartment you own (in fact, many condominiums are apartments that have been converted over the years). Your ownership extends inward from your interior walls, floors and ceilings. In addition, you are a partner, with all of the other owners in the complex, of the exterior structure (the foundation, exterior walls and roof) as well as any common areas and amenities (for example, swimming pools, clubhouses, tennis courts, play areas, etc.) One of the requirements of condominium ownership is the payment of a monthly condo fee, which covers general repairs and maintenance to the common areas of the complex as well as (hopefully) build up a cash reserve for future needs. In general, all exterior maintenance and repairs are the responsibility of the condominium association, although you will be charged for them, either through your association dues or a special assessment (a one time charge assessed to all owners for, as an example, a new roof). The normal day-to-day maintenance of the grounds (some examples are cutting the grass and maintaining the pool) are also the responsibility of the association. Interior maintenance and repairs (for example, replacing a dishwasher) are the responsibility of the individual owner.
In some areas, a condominium may be the only consideration that fits within your budget. The reason for this is simple. In general, the same square footage will cost less in a condo setting than it will in a single family home or townhouse, due mainly to land cost--you can build many more condos than you can single family homes on the same amount of land.
Advantages of a Condominium
- Little or no exterior maintenance or repairs
- Many condo communities offer amenities such as pools, tennis courts, playground, etc.
- Condos are often more reasonably priced and are good entry level homes for first-time homebuyers or excellent for empty-nesters looking to downsize
Disadvantages of a Condominium
- You are responsible for Home Owner's Association fees Less privacy
- Resale of a condo is harder and often takes longer to sell
You do not want to do any exterior maintenance or repairs
You like the idea of amenities
You don't mind having neighbors close to you.
All three forms of ownership are good options...it's a matter of finding the best fit for you. A house gives you more independence, but also greater responsibility. A condo or townhouse has the security of more regular expenses and freedom from maintenance and repairs.
Happy House Hunting!
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