What is the difference between a condo and a townhome? We often get this question from home buyers, so we decided to sum up the many conversations we’ve had into a blog in hopes that it reaches more people who are currently weighing the pros and cons of each. The technical difference is that the two property types are deeded differently. When you purchase a condo, you are purchasing the air space and not the land that the condo sits on. Townhomes are deeded as fee simple homes, meaning the buyer will actually own the tract of land that the townhome sits on, which makes lenders more apt to lend money on them. The West Ashley real estate market is a great Charleston market to find affordable condos and townhouses, so we’ve also included some of the most popular neighborhoods for you to start your search.
When looking for a townhouse or condo, most buyers prefer newer construction. There is a lesser chance of neighborhood assessments with newer homes, such as needing new roofs or exterior painting. When older communities need such large scale repairs, if the property management group hasn’t properly pooled its funds over the years to cover these costs, then homeowners have to pay these assessments out of pocket. Choosing newer developments can reduce the risk of such assessments, which is one of the main reasons that these tend to be more popular.
When it comes to financing a condo or townhouse, several factors come into play. If it is a true townhouse and deeded as fee simple, then the property qualifies for any type of loan, whether it be VA, FHA, or Conventional loan. If it is a condo, then it must meet VA, FHA, and Conventional loan guidelines. For instance, if the home owners association is in litigation, or if there are too many homeowners with outstanding HOA dues, or if there are too many renters versus homeowners living in the complex, then financing may not be possible. In these cases, the condos can only be purchased with cash.
Condos and townhouses usually have a regime or an HOA (homeowners association) fee that is collected either monthly or annually. Some homes have both a regime and an HOA fee. You typically see both fees in a community that is located within a larger neighborhood. The annual HOA fee is typically used by the parent neighborhood for upkeep of the community amenities and common areas. The regime fee can be used for items such as common area maintenance for your townhouse subsection, exterior yard maintenance, insurance if it is included, termite bond, annual power washing, exterior painting, etc.
For example, the townhomes in Hunt Club on Bibury Court in West Ashley collect $585 annually for the HOA dues to Hunt Club and also a $49 per month fee to Bibury Court regime. These are brand new townhomes built by DR Horton and are priced approximately in the low $160’s. This is a very nice neighborhood with a community pool, and the townhouses have small fenced in yards. It’s located off Bees Ferry Road. These homes qualify for VA, FHA, and conventional financing because they are deeded as fee simple.
Bridgewater at Carolina Bay in West Ashley is another example of a true townhome. These brand new homes are built by Centex, and prices begin in the mid to upper $170’s. They only have one fee, which is $165 per month, and it takes care of the fees for Bridgewater and the parent neighborhood, Carolina Bay. Bridgewater homeowners enjoy yard maintenance, two community pools (one of these is pictured above), an oyster pavilion, a play park, miles of walking trails, and a dog park. These homes also qualify for VA, FHA, and conventional financing.
If you are considering buying an attached home in Charleston, newer townhomes are generally the better option over condos because they are easier to obtain financing (making it easier to purchase now and also easier to sell in the future). Along with Hunt Club and Bridgewater, you may want to check out these other West Ashley townhouses: Bolton’s Landing, Ashley Park, and the Tidewater and Essex subsections of Carolina Bay. On our website, you can also search condos for sale in West Ashley.