Freehold Town-home or Condo

Freehold Townhome or Condo – The Struggle in the Decision

Jul 28, 2016

When it comes time to purchase a first home, many buyers confront the question: condo or town house? A myriad of considerations are factored into making the decision that is right for your lifestyle. Marlin Spring has compiled a list of these factors to help you choose whether to buy a townhome or condo as your first home.

Structure & Ownership

The most common configuration of a condo is that of an apartment within a complex–the apartment being privately owned by the homeowner, while all other connecting areas of the complex being communally owned by all condo residents. The interior space is individually owned, while the spaces outside of it are jointly-owned. A townhome consists of individual houses that are placed side-by-side. One or two walls of each house is shared between adjacent homes. Most townhouses are built more narrowly than traditional detached homes and are usually two- to three-stories tall. No land is owned in a condo. Instead, it is the space inside the apartment that is owned. In contrast, those who own a townhouse actually own the land their home is built on. With a Freehold Home, you are the owner of the home itself and the plot of land it sits on. If it is a Freehold Townhome with common elements, this means that parts within the subdivision are jointly-owned with those in the subdivision and are subject to monthly maintenance fees.

Fees

Freehold Town-home or Condo

Condos almost always have higher Homeowner Association fees (HOA) than townhouses do. This is because condos have more shared spaces and often some unique amenities, such as a pools or saunas in the fitness area, which require more money to maintain. Affordability-wise, despite the fixed maintenance fees, a condo will likely be cheaper than a townhouse simply due to the difference in square footage. From an investment perspective, however, if property values continue to rise at average rates, the townhouse will appreciate more quickly. Although you would be paying more for a townhouse initially and on a monthly basis, it would most likely appreciate more rapidly, and enable you to build more equity over the years. On the other hand, if you are not planning to spend many years in the home, you would be slightly better off financially, on a monthly basis, if you purchased the condominium.  Water, cable, internet service, some insurance coverage, and other services or utilities may also be included in a condo’s monthly HOA fees. Townhomes often, though not always, have HOA fees as well. Freehold Townhome fees are usually much lower and often only cover a small set of services, such as waste service and lawn care of shared amenities (Parks, sitting areas, etc.). Both condo and townhouse owners must pay property taxes. Lenders consider condo fees to be part of your fixed monthly costs, resulting in a higher gross debt servicing ratio. Lenders use a simple calculation to compare your income to your fixed expenses to determine the mortgage amount you could potentially qualify for, pending your credit score.

Maintenance Costs

Freehold Town-home or Condo

The freehold townhome owner must assume personal responsibility for the landscaping and maintenance of their individual property. Gardening, lawn-mowing, and shoveling walkways and driveway in the winter seasons are tasks which remain the responsibility of a townhome owner. Condominium ownership offers many advantages, such as the potential to build equity, title, and privacy within your unit. With a condo, you can count on the fact that your property is being well maintained with little effort on your part. On the contrary, townhome units offer other advantages over the condominium option.You have more freedom to alter your property to suit your needs, and since you are responsible for upkeep, you have a bit more control over your maintenance costs. You can keep expenses down by cutting your own lawn and shoveling your own driveway.

Amenities

Freehold Town-home or Condo

One of the most appealing aspects of purchasing a condo, is gaining access to many different amenities. While it can vary depending on the condo, many include a pool, as well as a gym, and an array of indoor and outdoor common areas for entertaining. These amenity areas are communally owned common areas. These areas are kept clean and in good condition with the money brought in by HOA fees; even the roof of the building is communally owned. While freehold Townhouses often include common areas, they are usually fewer. Though townhomes share one or two walls, they are considered individual and independent homes, typically with individual yards (that may be fenced) as well as individual garages. Very little is jointly owned. However, in some cases townhouses may be part of a larger neighborhood/subdivision which has a communal area, such as a small playground, pool, or park in which case these areas may be subject to fees as well if managed by a property management company. Condos can often have restrictions put in place by the condo board association, such as pet restrictions, as well as rental permission. Should you opt for a condo, keep in mind that the costs are more or less fixed. You have no control over when to pay your condo fees. Just like a mortgage, it’s a monthly obligation. If, however, you were to buy a townhouse, the expenses would be a little more varied.

Lifestyle

Freehold Town-home or Condo

Condo life is about more than your unit’s stunning granite countertops–it is also about factors such as convenience and neighbourhood atmosphere. While you enjoy more privacy and anonymity within your building, you are typically immersed within an urban location close to trendy cafes and all that a city centre offers. When you live in a townhouse, you immediately become part of a community. Townhouses are situated in close proximity which logically connects you to the townhome owners around you. Even with this close community feel, you still have your own distinctive area without anybody living above or below you. Townhomes are typically situated farther from city cores, as more space is required for townhomes than condos.

Townhomes and condos are both great options for a first time home buyer. Whether our condominiums or townhomes, Marlin Spring offers the latest in sophisticated, contemporary style and finishes, beautiful upgrades and tasteful design. The trick is in taking account of the above factors, and figuring out which is the best fit for your lifestyle.