First, both the words "condominium" and "planned development" (there is actually no such thing as a planned "unit" development) refer to the type or form of ownership for the property. In a condominium complex, you would own only the "box of air" bounded by the perimeter walls of your home. Condominiums can be both "apartment" style units as well as homes that look and operate like that of a townhouse. A townhouse, too, refers only to an architectural style and does not imply a form of ownership. In a condominium complex, as the CC&Rs state, the owners in the homeowners association own jointly all those areas outside of the interior walls of your home including the land, the buildings and any shared recreational amenities. The areas assigned to your home and bounded by walls are called "exclusive use common areas" (or EUCA) and are not owned by the homeowner, but assigned to the exclusive use by the owner of the condominium unit.
On the other hand, a planned development is a form of ownership in which the home owner owns both the land beneath the building and up to specific property lines comprising a "lot". Planned developments may be composed of both attached and detached homes. The key here, however, is that, unlike a condo, the owner owns the building and the land. The term "zero lot lines", which refers only to a planned development, means that the building or a portion of the building sits right on top of the property line between two lots. Developers often place a home on the property line to increase the size of the back and side yards, or, in the case or a row- or townhome style, the zero lot line is in the ground and walls between two units.
Given all of the information that you have added in your comments below, you do NOT have a condominium, but, instead, own a lot in a planned development. But this begs the question, why do your CC&Rs say "condominium" when it is clear that you own a lot. There may be two reasons for this: 1) the most obvious is that you may have been given the wrong set of CC&Rs for this property, if so, point that out to your Realtor so that you can get a second set or 2) this is a mixed-use community with both condominiums and homes in a planned development. If this is the case, then you are reading that portion of the CC&Rs that applies only to the condominium units, and not to your home which is a planned development. If you read further, there may be references to specific lot numbers that are part of a "planned development."
If you continue to have questions about this matter, please contact your Realtor. For more general information about homeowners associations, see my blog at the website below. Good luck and congratulations on your home purchase!
Grace Morioka, SRES, e-Pro
CID Specialist, Forward Planning Consultant
co-Author: Homeowners Associations: A Guide to Leadership
In Corona is it my understanding that any lot that is less than 7200 square feet can be considered a condo lot. ( Not actually a condo or town home) It has to do with the definition of a single family residence requires 7200 square feet lot or more according to the city of Corona. It also had to do with the amount of improvements that were required by the city for the builder, I think. You would need to go to the planning department for a better understanding. There where some developers who didnâ€™t know how to work with this ordnance and it did cause problems, especially in the lending on those homes. Because of the way title was determined lenders put them under the category of condoâ€™s causing the interest rates to be a bit higher. You needed to have a lender who was use to the ordinance and had the ability to explain it to the underwriter.
As for Zero Lot lineâ€¦that is when the structure of the home is actually on the lot line (hence the name Zero Lot Line). It is only on one side and usually the lots are very small. On Zero Lot lines the neighborâ€™s home is actually like the fence. You are not allowed to adhere anything to the neighbors home.
By the time you get done asking all of your questions you be ready to get your license. Keep of the good work. Information is important when making your decisions. And actually Knowledge is priceless.
Even though Linda's answer is correct for a lot of the homes in Corona, it is not correct for all... please make sure that you check into your friends property before you give him the answers you find here.
This type of condo is very common in the Seattle area. Technically these homes are classified as condos but they function like single family homes. You own you home and your lot outright, no divided interest with anyone. Yes there are usually some sort of common areas owned by your HOA. The reason for this is that developers want to make more money so this is a way of gettting more homes on the land, typically your streets will be narrower as well. I lived for several years in a home like this, your HOA dues go for things like street maintenance, ligthing, etc. As in any HOA you have to get approval to make changes to your home but this applies to "regular" homes as well as most newer homes have an HOA. The confusion comes from those realtors, appraisors and lenders who don't understand how the detached condo system. works.
Have your friend go to the building department; they should be able to shed some light on the situation, also look at the title report. One last place is if he looks at the appraisal, see what they are compared too. Since I don't know which property it is, the undivided interest in the common area or the home. Look at the plot map, is the foot print your friendâ€™s property or is it a lot of the homes?
If his realtor canâ€™t help, then ask to speak to his/her broker.
You are right about it being a drag with the lender.
California Certified Real Estate Appraiser
I'm happy to hear that it looks like you will be able to close your escrow soon with a home that you are excited about. I must say I will miss your questions. They were very good questions, they showed that you were willing to find out all that you can in order to make an informed decision about your major purchase. I'm sure that the answers were not only helpful to you but also to many of the other buyers.
Good Luck and enjoy your new home
First, thanks to both of you for your replies!
To follow up, I just spoke w the City of Corona and they confirmed much of what has been described. They said the lot-size limitation of 7200 sq ft was a voter initiative back in the 80's and this was a way that some of the builders worked with the city to work around the issue. What they do is this:
They take a much bigger lot and subdivide it into "condos". Each "condo" has exclusive use of the area around its home - basically the area enclosed by the fence - and any remaining land is considered "common area". They also set aside certain "condos" as specific common area such as a small park or a walking trail etc.
The lady I spoke with in City planning says she has one, and has had it for years. She says it looks, feels, and smells just like your own home, the only thing is how it is titled. She also said they are all over Corona, and there are quite a few in Orange County now. She thinks there may even be some down in San Diego.
The gotcha is that per the title, you actually own the land making up that larger lot jointly with the other owners. (Property Data on tax bill, for example, says "...INT IN COM IN LOT 4...")
And that, along with the fact that the title will show as condo means that some explanation needs to be given to any future lenders. The planning lady said most lenders in the area already know about these, but as Diana said, this won't necessarily be enough info for Fannie/Freddie, et al.
Having said that, the home is in great shape, the neighborhood is beautiful, and I got it for $40k less than a comparable property just down the street, so I am probably going to buy it anyway. It was definitely either #1 or #2 on my list of properties on which I have made offers, but I've heard through the grapevine that someone else is willing to keep up a bidding war on #1. And we are still waiting to hear back from the first bank on #1, let alone the second, whereas I have both lender's approval on this one, it's been inspected, and we are just waiting on the HOA docs for this one. Once we receive the HOA docs, we can close this week or maybe Tues.
Anyway, thanks again for your help!
Well, this is new one for me, and I've been in this industry for 25 years. Now that Diana has provided more information, it certainly does make sense.
In the broadest sense possible, the City of Corona has allowed the homes to be called condominiums and on the condominium map and plan (which shows the boundaries of the "condominium"), the City has chosen to allow the three dimensional "box of air" that constitutes the condominium to stretch out to the perimeter of the yard boundaries and then to go up and over the building. So, in normal situations, where the building's exteriors constitute the "box of air", in this case, the three dimensional description goes outside of the home to include the structure, the landscaping inside the yard and the yard boundaries. Actually, this is very, very clever! Here's the cool part--because the entire complex is considered one big huge lot or several large lots depending on how the property is broken up, the City can circumvent their 7200 s.f. requirement for single family homes and allow as many single family free-standing homes as they want within City limits but still give owners the freedom to control their entire building exteriors and the yard enclosed by the condominium description. Really, my hats off to the City of Corona--this is brilliant!
Okay, Crazy, you have a condominium. But, because the entire building is enclosed inside the condominium "box of air" you can do whatever you wish inside that box, including maintenance, painting and antennas and, most importantly, insurance. Although this is a condominium, the description was created solely to circumvent the 7200 sq ft requirement, while still affording you (as the homeowner) the rights and freedom to have a single family home with full control over the building.
Thank, Diana, for that explanation. This is definitely a new one for my book!!
Grace Morioka, SRES, e-Pro
Pleasantly Surprised and Startled CID Specialist
Area Pro Realty
The listing agent is correct it is all over Corona...there were a couple of builders who actually have the plot map created as condoâ€™s, but the houses do not touch, nor are they zero lot lines., so make sure you check out the plot map. It will be in your pre-lim or your agent can order you a property profile. It was a bit of a problem when re-selling those homes, but not one that could not be overcome. With the lending tighten up it could be more of a problem now as apposed to then, especially since we and the lenders will not be allowed to speak to the appraisers on Fannie and Freddie loans, but Iâ€™m not sure. I know you are purchasing cash but this is something to remember if you are going to sell the home in the future.
Thanks very much for your comments. As it turns out, Diana is probably right.
The CCR's are for the correct HOA and it is definitely referring to the SFR homes in the community as condos.
When I submitted my question to Trulia, I had also contacted my agent, but she hadn't called back yet. When she did call, I told her about what I was seeing. She'd never heard of such a thing and said the house clearly is a SFR. So she called the listing agent who said almost the exact same thing as Diana said.
The listing agent added that it also had something to do with the size of the houses - something about them not being 4000 sq ft, although it primarily had to do with the lot size. The listing agent also said that he sees this all over Corona - this is not the only development that has this.
So even though I have the largest lot in the area, it still does not qualify in Corona for SFR and consequently, the house will probably show up as a condo on the title. I'll find out more next week when I call Corona planning.
Anyway, thanks again!
I kind of ran out of space due to the definition in the CCR's being so long or I would have given more details, sorry!
I have never heard of "zero lots lines" and can't find a good definition, so I don't know if this house would fit that description. The home is on a lot of almost 7000 sq ft, enclosed by a fence. I am responsible for the front yard as well as the back yard and the fence and of course anything to do with the ouse itself.
In other words, the HOA does not maintain any part of the yard, fence, or home, and the home itself has no adjoining walls. The only things the HOA pays for are the main wall that runs around the entire community, landscaping external to the wall, and the small park that is located inside the park and is restricted to those who live in the community. This would match the common area description you provide, but is really way outside of the bounds of my property.
From this information, I don't believe it would qualify as a patio home. Do you know the definition of a "zero lots line" home and if so, do you think this qualifies?
The owner of the condominium also owns a common tenancy with owners of other units in the common area, which includes all or some of the following: driveways, parking, elevators, outside hallways, recreation and landscaped areas, which are managed by a homeowners' or tenants association. If the condominium unit is destroyed by fire or other disaster, the owner has the right to rebuild in his/her airspace. Most states have adopted statutes to cover special issues involving development, construction, management and taxation of condominium projects.
Hope this helps.