The Townhome Life: What to Know About Buying a Townhome

A living room with a big window and a fireplace. Through the window may be seen several trees into the back yard.

Thinking the townhome life looks right for you? Take a moment to learn what it means to buy a townhome. Photo: The Spencer Plan at Lexington Chase by Lexington Homes in Palatine, Ill.

Whether you’re a single bachelor or bachelorette looking for your pad in the city or a retired couple looking for a maintenance-free lifestyle, the townhome life might be right for you.

But are you sure you know everything there is to know about 
buying a condo? Oh, wait, a townhome? Heck, is there even a difference?

No matter how much you think you know, it’s never a bad idea to do a little research before making a large investment like buying a townhome. So before you pull out your checkbook, take a look at some of the following tips and facts from a few townhome connoisseurs. 

You Say Townhome, I Say Condo

First things first, what’s the difference between a condominium and a townhome? Sometimes it just depends on who you ask.

“This is often confused,” says Jeff Benach, co-principal of Chicago, Ill.-based Lexington Homes. “A condo is actually a form of ownership, not a building or dwelling type. Townhomes can be either condo ownership, where everyone collectively owns all the ground, or ‘fee simple’ just like single-family homes.”

With fee-simple ownership, the buyer also owns the ground directly beneath the unit, while in both cases everyone collectively owns the common area of the complex, he says.

“Yet, in another definition, the difference is that the condo building would be multiple floors with a common entrance … whereas a townhome is more of an attached single-family residence,” adds Benach.

However, Karim Wahba, a Realtor with Realty One Group in Mission Viejo, Calif., has another interpretation.

“Some definitions state that if a property is only one story it’s a condo and if it has more than one level it would be a townhome, while others classify townhomes as those with attached garages,” he says.

The moral of this story? Call it what you want.

“When I meet with first-time buyers and they ask me that question,” adds Wahba, “I just make it easy on them and tell them it’s pretty much the same thing.”

A Few Other Key Differences

Now that that’s settled — well, kind of — it’s time to consider how a townhome might differ from buying a regular home.

With most townhomes, there will be a monthly homeowner’s association (HOA) fee to cover things like maintenance, landscaping, facilities, amenities and insurance. However, these may vary from builder to builder, so it’s important to talk with them ahead of time so you can calculate your monthly fee into the budget.

The 
HOA is a good way to discover the quality of the community you may be buying into.

“Look at the financial reports including the number of delinquencies for the association,” says Sally Balson, owner of Condominium Business Management LLC in Madison, Wis. “Look at the budget. Look at how many units are [occupied] or not lived in by the owner. Review the condo documents to make sure that they understand what is required and evaluate if you can live within the rules.”

In regards to rules, it’s also highly important to have a prior look at the community’s CC&Rs, or covenants, conditions and restrictions.

“One of the main differences between buying a single-family residence and a condo or townhome is that when you are buying a townhome, you are bound by the rules and regulations of the community in which that home is located,” says Wahba. “Buyers need to review the CC&Rs to make sure these regulations fit their lifestyle.”

Living the Townhome Life

So who’s this townhome lifestyle suited for?

“Anyone who wants a single-family home experience without the yard and exterior maintenance or responsibilities,” says Benach. “That’s mainly young couples starting out usually before they have kids, empty nesters downsizing or transitioning out of single-family homes, young singles and/or newly divorced singles with kids.”

Location is another key consideration with the townhome lifestyle, as most townhomes are found within close proximity to major city centers and urban environments. Think public transportation hubs, retail areas and 
downtown city centers. So if your lifestyle involves regular outings for dinner and shopping, the occasional venture to local bars and dives or a career with travel, you might be on the right track.

“The carefree lifestyle of townhome residents is enhanced considerably when you’re able to walk to transportation, shopping and recreation,” says Priscilla Schumacher, director of sales and marketing at Edward R. James Companies, a homebuilder based in Chicago.

What about size? With all the options out there, it’s likely this won’t be an issue.

“Many townhomes offer as many bedrooms and baths as single-family homes, as well as a garage,” adds Schumacher.

And affordability?

“Condos and townhomes are typically more affordable than houses in any given neighborhood, so some buyers prefer a geographic location but can only afford to buy a condo or townhome in that location,” says Wahba. “This is becoming very common with many younger families in Orange County where they prefer to be in a specific neighborhood so that their kids can attend a certain school.”

Still on the fence? The last thing to do when deciding if the townhome life is right for you is to simply ask questions.

“When folks are looking for a home, they should make a list of what is important to them,” says Balson. “Do they want a yard? Do they need a place for pets? Do they have children? How many bedrooms do they need for their family? What is the school district like?”

If you can find a townhome that suits all those needs, you’ve probably found your answer.

Drew Knight is a freelance writer for Builders Digital Experience (BDX). You can find him online at LinkedIn.

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