The terms “condo” and “townhome” get thrown around very casually, but in reality they are quite different. A condominium owner owns what is inside the unit, while a townhome owner actually owns portions of the structure and the land underneath the home. The appeal of condos and townhomes is usually the same; the homeowner’s association takes care of the required maintenance, allowing the homeowner more free time. Often, condos and townhomes are 2nd homes, or for busy professionals or traveling grandparents.
The pitfalls of townhomes and condos can be the same as well; ever increasing HOA dues and a lack of control over how and when money is spent and units are maintained. While townhomes can have shared side walls, condos can bring additional challenges, with an “apartment” style feel as you might have residents living above you and or below you. Condos can also be questionable investments, as the owner doesn’t own any land. If a condominium complex has more units rented than owner occupants, financing can also be an issue for a buyer getting a loan to complete the purchase. So, why buy a townhome? When you want the flexibility of “easy, low maintenance living”, and you are comfortable with the HOA set up and board of directors. Why buy a condominium? The answer is all about LOCATION. When the location of the condo dictates higher density living, often a condo is the only choice. Buyers must beware of issues like parking, trash removal, security, and utilities. Also be aware of the cost of maintaining and availability of using common spaces such as grilling decks, party rooms, or gyms. So which one is a better investment? A townhome, unless you love the LOCATION of the condo. Then go for it!