What is the Difference Between a Condo and Townhouse

There is a big difference between a condo and a townhouse. A condo is a type of ownership whereas a townhouse is a type of building.  Each are defined as:

  • Condominium - individual ownership of a unit in a multi-unit structure with common elements shared with other owners

  • Townhouse - single-family dwelling connected to a similar house by a common sidewall

However, a townhouse can also be a condo.  It depends how the ownership structure is setup.

In this article, we’ll explore this topic in greater detail.  We’ll also go into the pros and cons of condos vs townhouses.

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Difference Between a Condo and Townhouse

There are merits for each.

However, before making a decision on which is best for you, you need to know the specific differences between a condo and a townhouse:

Condos

A condominium or condo is characterized by joint ownership of the common areas such as the swimming pool, walkways, tennis courts, etc.

What a condo buyer owns is a share in the building.  Not the building itself.

This is much different than a single family house.  In that case, the owner owns the structure itself.

See the difference?

It goes on though.  In a condo building, the actual structure and the land is owned communally by every buyer of a condo unit in it.

The bigger your condo, the larger your share is.

But then who manages maintenance?

The maintenance of common elements is managed by the Homeowners Association (HOA).  To be a member of the HOA, you need to be an owner in the condo development.

Members are voted into the HOA by other condo owners.

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 Condo owners are usually expected to pay HOA fees (commonly called condo fees) on a monthly basis.

The fees can range from $150 to $400 per month.  How much you’ll contribute depends on:

  • The province you live in (some province have laws that dictate how big reserve funds need to be)

  • The city you live in

  • The amount of amenities in your building that need maintenance

  • The age of the building

  • The size of your condo

The HOA fees cover maintenance such as landscaping, amenities, or the actual structure (ie roof, outer walls, doors). But repairs inside the unit are the responsibility of the condo owner.

For example, you’d be responsible for renovating your floors or replacing old appliances.

Condos are governed by legal statuses.  Each province sets out the basic rules a condo board needs to follow.  They usually dictate:

  • The size of the reserve fund

  • How an HOA is formed

  • What an HOA must inform other owners about

  • How often an HOA must report to the owners

  • How condo bylaws can be voted in

However, the specific condo bylaws are voted in by the condo members.   Individual condo bylaws usually touch on:

  • Noise regulations

  • Aesthetics such as color or curtains and blinds

  • Common elements use.  For example, if owners can leave their shoes in the hallways

  • Health and safety.  For example, if one can have a BBQ on a balcony

  • Purpose of the condo.  For example, if one can use a condo for commerce or business

The specific condo bylaws are enforced by the HOA.

Now let's look at townhouses.

Townhouses

As mentioned before, a townhouse has more to do with the style or architecture of a building and not type of ownership.

Townhouses can be in a town setting and sometimes connected to adjacent units by a shared wall. However, each owner has clear ownership to his property.

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 A townhouse is usually comprised of two floors (to save on space).

The top stories may house the bedrooms and sleeping areas while the ground floor often contains the living room, kitchen, dining room, etc.

Townhouses may have a small yard either in the front or the backyard where owners can keep a small garden.

For townhouses, community amenities tend to be rare but not entirely unheard of.

Townhouse owners can sometimes expect to pay HOA fees. However, these tend to be lower than the fees for condos since they are fewer common areas that require maintenance.  Additionally, each townhouse owner is responsible for the repairs in their properties.

The HOA fees are generally used to fix common roofs or take care of joint landscapes.

Quick Recap and key differences

Check out this info-graphic on the difference between a condo and a townhouse.

Also, check out this simple comparison between condos and townhouses.

As an investment, both condos and townhouses have their pros and cons. A lot depends on your long-term goals in buying the property. The location also factors into your decision.

Check out some top reasons why millennials may prefer condos to others property types.

Regarding privacy, townhouses may offer more privacy than condos since they are no people living above and below.

However, when it comes to security, condos may be more secure since they share security features. These can include security guards and manned video surveillance. Because condos are on a higher floor, they also virtually eliminate the risk of break-ins.

Final Thoughts

Whichever property type you decide to invest in, do your due diligence.

While some investors may shun condos due to their perceived lack of privacy and high HOA fees, sometimes they can make great investments.

Consider the location, amenities, utilities, the community as well as any fees before making your choice.

Simon Elstad