A Comparison - Condominiums and Townhomes
Compare Condominiums with Townhomes

1. Legal descriptions define the kind of property: condo is space, footprint means townhouse. 

2. Co-ops and condos may look alike but their legal definition is very different. A co-op is a corporation with shares. The living unit is an apartment. Financing is also structured differently. In Charlotte, NC, there are two co-ops: Kimberlee and Morrocroft.

3. Sometimes people say "Garden" when they mean "all on one floor". A better description for that would be "flat" not unless there is no unit above or below.

4. Yes, the fancy name for condo is "Villa"...it still defines space.

5. Here's a telltale sign: a condo has a Unit File designation, ergo U/F. When in doubt look for U/F in the legal description. Interestingly enough, in Charlotte that number usually is the designation. For instance, Gaynor Arms was the very first condo in Charlotte, it is U/F1. Quail Hollow Estates is U/F 3. It is the third complex built.

6. A townhouse requires a survey. A survey can only be shot if there is space between the units. Most conversions, while looking like townhomes or cottages are actually condos.

7. It may come as a surprise, but yes, there is a difference in financing for a condo and for a town home. It is important to make sure you know the legal definition of the unit you may be considering. The differences have changed as the mortgage lending business re-defines itself. In writing an offer or seeking financing, be doubly sure there are no nuances. The only constant in financing differences would be, but not always, hazard insurance.

8. Insurance:there is special condo insurance that insures from  the paint "in". The dwelling is covered by homeowners insurance. Be sure to read the master policy first because insurance coverage can vary. Improvements should be detailed because regular condo insurance may not cover what is perceived as regular loss. (See discussion on improvements covered by insurance).

9. A townhome owner would need the same kind of insurance as a single family home. Often hazard insurance policies for a group command a lower premium.

10. Attached housing (condominiums) depends on certain qualifications for loan approval from FHA, VA and for Conventional type loans. Make sure you know what approvals the complex has. Why is this important? The old rule: be sure you can get out when time comes for you to move on. Special financing and balloon type loans may deter you.

11. Check owner occupancy percentage. High investor ratios may make it hard for you to get a loan and if you do it may be at a higher rate and may require more money down.

Gaynor Arms
U/F 1
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