Oct 23, 2015

The Benefits of a Townhome

Fossil-Hill-46The house Lifestyle, with the Condo Convenience!

Many homeowners who want to live near city centers choose townhomes as a good mixture of affordability and privacy. Typically a single family home is larger and comes with a yard. Inside cities these can be rare and expensive. Urban condominiums are a popular option, but the owner of a condo only truly owns the space within the walls themselves.

A townhouse typically has its own front and back entrances, is multiple stories, and has one or two shared walls. Common in urban areas, townhomes vary widely from location to location.

The exact definition of a townhouse is fairly vague. Some townhomes have homeowners’ associations similar to condos. An HOA will usually cover the maintenance costs for grounds and other shared areas, but in exchange, you give up some of your control. Even if your townhouse only has one shared wall, you will still have to share some control and cost with the owner next door.

 

fossilHillsFloorPlansFinancing Thoughts

Unless you are paying cash to buy a townhouse, you will obtain mortgage financing. One of the items to consider is that lenders find it hard to accurately classify and appraise townhomes. Mortgage financing is more expensive and restrictive for condos. Some lenders choose to underwrite all townhomes as if they were condos, leading to higher costs. Some have more lenient guidelines. If you are buying in an area with a lot of townhomes, it’s a good idea to find a lender with experience in the area. Maybe even speak to the other owners to find out who they used for financing.

When lenders underwrite condominiums, they place restrictions on the number of units that can be rented, rather than occupied by the owner. They may underwrite a townhouse complex the same way. So before buying, it would be good to find out how many units are being rented. Homeowners’ associations often try to restrict the number of units that can be rented as well, so if that is in your own long-term plans, find out if it will be allowed.

 

What To Know Before You Buy

Despite the complications and potential costs of financing, townhomes may offer the most attractive home buying option in many urban areas. The multi-level layout, and private entry give the feel of a single family home, without the expense that comes from owning and maintaining your own property. Despite the shared wall, a townhouse can feel more private than a condo, or apartment,

yet the homeowner’s association gives much of the same convenience and protection. If you are in the market to buy a townhouse, talk to your realtor and mortgage professional to make sure you know all the details and obligations of the property in question. Remember, every townhouse is unique.fossilHillsSitePlan

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