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Single family home vs apartment or townhouse as your primary residence (which is best for you?)

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The standard route to home ownership is a single family home, but that does not mean it is always the best choice!

Maybe an apartment or townhouse better suits your budget, needs and lifestyle.

So, if you are in the market for a new home, start by deciding on the best type of property for your primary residence. Which one best suits your needs and desires?

Read on to discover key differences between a single-family home versus an apartment or townhouse. And then consider how your lifestyle, priorities and needs can influence your choice.

Single Family Home Vs. Townhouse vs. Condo

The primary difference in property types is ownership, responsibility and location.

Let’s look at the distinguishing differences you can consider.

illustration of different residence types

Single Family Home

A single family home is a detached house on a piece of land with separate utilities and street access.

The entire property is the owner’s responsibility, including utilities, indoor and outdoor maintenance, and lawn care.

Apartment or townhouse

A apartment has its own entrance with shared walls, roofs and other common areas. They also often have extra amenities, such as swimming pools, gyms and security.

Many people think of condominiums as apartment buildings with little or no land. And while this is often true, apartments are defined by ownershipnot built type.

When you buy an apartment, you own the inside of your apartment.

However, ownership of the building’s exterior, site, and common areas is shared so that it is covered by the Homeowners Association (HOA).

A townhouse is one, two or three storeys high attached house with shared walls and its own entrance. Most do not have units above or below them.

Townhouse ownership can be structured in two ways: fee simple or condominium.

With fee simple ownership, you own the house’s interior, exterior and land on which it sits.

It’s like owning a single home, except it’s a detached house.

But with condominium ownership, you only own the inside of the house; the HOA covers the outside.

Both types of ownership usually have HOA fees and regulations. Yet the fees are generally higher with the condominium ownership structure.

What about duplex, triplex and quadrilateral units?

These properties look like townhouses. But only one person owns an entire building and rents each unit.

In other words, there is no shared ownership among residents.

If you want to invest in real estate, you may want to consider buying a multi-family property.

For example, if you buy a duplex (or triplex or quad), you can live in one unit and rent other units to tenants.

This is called “house hacking” because rental profits help pay for the owner’s housing expenses.

But this is obviously not for everyone. So weigh the pros and cons before buying a multi-family property!

Single-family home versus townhouse or apartment as your primary residence: What is best for you?

To decide which type of property will suit you best, consider three factors:

  1. Your budget: Purchase price, financing, insurance, taxes, fees and maintenance.
  1. Your needs: Affordability, square footage, storage and location.
  1. Your lifestyle: Amenities and community, your free time, DIY skills, and more.

Why buy a single family property as a primary residence?

Below are some reasons why you may prefer a single home over a townhouse or apartment:

Location. You can buy a single home almost anywhere! So, if you want to live in an urban, suburban or rural area, you can probably buy a house there.

Privacy. Most single-family homes have private plots and no shared walls. Consequently, it is more likely to have quiet, private living spaces.

Freedom. In addition to HOA rules and zoning, you have the freedom to do whatever you want with a single family home.

For example, you can decorate as you like, plant a garden and pursue your hobbies (anyone woodwork?).

Space. Single-family homes usually have more space and storage, inside and out (but not always).

Variety. From cute bungalows to modern farmhouses, you can find a single family home in any style. Plus, you can landscape as you like!

Disadvantages of Single Family Home Ownership: Money and Time

Single-family homes are usually more expensive than apartments or townhouses. They also often take more time to maintain (with more headaches.)

As they are often more spacious, they also have more maintenance, insurance and taxes.

And you must do all the repairs and maintenance for the interior and exterior unless you hire someone.

Why buy an apartment or townhouse as a primary residence?

Here are some reasons why you might want to consider a single family home or townhouse:

Less maintenance and upkeep. HOA fees often cover lawn care and snow removal. And apartments also include outbuildings and landscaping.

Comfort. Most apartments and townhouses are in urban and suburban areas with nearby amenities. They are therefore often close to shopping malls, restaurants, public transport and other services.

Extra community perks. Some apartments have social activities and other fringe benefits, such as gyms, swimming pools and security.

Lower costs. Condos and townhouses often cost less to buy and have cheaper insurance, maintenance and taxes.

But do not forget to add the HOA fees. Once tackled, some are comparable to the cost of single-family homes.

Disadvantages of apartment or townhouse ownership: Space and flexibility

Condos and townhouses often have small plots (or no plots), limited storage and fewer square feet.

In addition, the HOAs restrict your freedom and control over the property, and the fees can add up.

Another downside is their resale potential, depending on where you live. Affiliated homes often take longer to sell and are not valued like single-family homes.

The ins and outs of Homeowners Associations (HOAs)

Almost all townhouse and apartment communities have HOAs. And some suburban single-family neighborhoods do that, too.

Each HEV is unique, so it is essential to review HEV fees and regulations before making an offer on a property.

Here are some important things to learn about a HOA before making an offer:

1. The fees. Find out the monthly (or annual) HOA fees. Also ask about special assessments — extra HOA fees for significant improvements and repairs.

These assessments can cost residents thousands of dollars. So see if the HOA has money in reserve to avoid this scenario.

2. The rules. Read all the covenants or ordinances. It’s not fun to read, but it’s information that can make or break your experience of living there.

They can, for example, restrict pets, home improvements, vehicles and more.

And if you do not follow the rules, you face fines, property liens and even lawsuits.

Decide what type of property is best for you

Consider your priorities, lifestyle and goals to make the best decision.

It’s helpful to do a little homework and write it all down!

Consider the following:

  • Your needs: For space, privacy and storage.
  • Your budget: Includes the down payment, insurance, taxes and HOA fees.
  • Home maintenance: How much money and time do you want to spend on maintenance?
  • Your desired location: Do you want to be close to schools, shopping, work or public transport?
  • Your lifestyle: How will each option work with your family, work, hobbies and leisure time?
  • Your exit strategy: How easy will it be to sell? How desirable is this type of property? Did you appreciate it? Can it be rented out?

Think about your current situation and your goals for the future.

Then imagine what daily life can be like to live in different types of property.

Then you can make a good decision about what is best for you!

Next: What To Know Before Buying A Home Together Unmarried

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Article written by Amanda

Amanda is a team member of Women Who Money and the founder and blogger behind Why We Money. She enjoys writing about happiness, values, money and property.

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