What’s the Difference Between a Condo and a Townhome?

Condos and townhomes are two different styles of houses that can appeal to a wide range of homebuyers. That’s not only because condos and townhomes are widely available in urban and rural areas as well as fast-growing suburbs, but also because condos and townhomes can vary greatly in size and style. If you’re one of the house-hunters wondering which type of residence to buy, here are the most important differences you should know about these two housing options.

Basic Differences

In general, condo units are part of communal buildings, also known as condominiums. This means that a condo unit shares its walls, floor, and ceiling with other units within the same building. Although most condos have similar layouts to apartments, you can also find different multi-level or split-level options.

A townhome, on the other hand, is a type of single-family residence that typically has 2 floors. In most townhomes, the kitchen, dining room, living room, and bathroom are located at the bottom floor, while the bedrooms, master bathrooms, and other private spaces are found on the top floors. Although a townhome is part of a group of residential buildings and, just like a condo unit, it shares one or both side walls with other houses, it usually offers more privacy than a condo. 

Ownership

When it comes to ownership, the most significant difference between a townhome and a condo is that the homebuyer will own both the interior and exterior of a townhome, but only the interior of a condo.

Because when you purchase a townhome you own the structure as well as the land it sits on, townhome ownership is similar to that of a detached single-family house. In a condo building, you only own your individual unit, which is essentially the space between the walls, ceiling, and floor. The building’s exterior and communal areas are owned collectively by the condo owners in the building. Because condo units come without land, they can be less expensive than townhomes. 

Amenities

The amenities provided by the community are one of the biggest perks to opting for a condo or townhome. Although not all the communities in Florida provide amenities that can enhance the lifestyles of residents, many condominiums make available a swimming pool, gym, clubhouse, and even a tennis court. Depending on the location, some condos also offer some special perks, like golf courses, marina access and beautiful gardens. 

Compared to condos, townhomes tend to have fewer amenities. Although parks and fitness centers are the most popular amenities you may find when looking for a townhome, some new townhome communities offer more amenities than condos, which range from swimming pools, tennis courts, gyms, clubhouses and playgrounds to resort-style amenities that keep residents active and entertained. Another plus point of purchasing a townhome is the personal outdoor space that you won’t get when buying a condo unit.

Homeowners Association Fees

When purchasing a condo, the owners are responsible only for the maintenance of the inside of their individual units. The HOA is in charge of maintaining the building’s exterior and communal areas, such as hallways, elevators, parking structures, gyms, pools, and any other amenities, as well as securing insurance coverage for all the shared spaces and structures. As a general rule, the more services an HOA provides, the higher the HOA fee will be. 

Townhomes usually have lower HOA fees than condos. Why? On one hand, most townhomes offer fewer amenities than condominiums; on the other hand, the owners of townhomes are usually responsible for their own lawn care and exterior home maintenance and repair. However, in some townhome communities, the HOA also manages the exteriors and roofs of all the homes within the neighborhood, which may result in higher HOA dues.

Financing Options

From a lender’s viewpoint, the most important difference between buying a townhome and buying a condo is that the former includes the land with everything above and below it, while the latter includes only the unit, without the ground underneath it.

Although you can find different types of home loans available for condos, including FHA and VA loans, the condo unit you intend to purchase must meet the specific requirements of these loans. Conversely, getting a mortgage to buy a townhome is almost the same as getting a loan for a single-family home. However, some lenders impose specific underwriting criteria that must be met on attached homes, which can include condos as well as townhomes, since both of these housing options can be defined as such from a legal standpoint.

When deciding between a condo and a townhome, there are three important things to consider: your lifestyle, budget, and the desired involvement in home maintenance. Regardless of which type of home works best for you, our experienced underwriters can help you understand your financing options and choose the best mortgage for the condo or townhome you want to buy!

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