TownHome vs TownHome Style Condo ?

Asked by John Mathew, 94568 Mon Jan 24, 2011


We really like apartments over at Amlafi at Sorrento Dublin Ranch in Dublin , CA. These condos are town home style layout and medium price is around $430 K. We wanted to know what is the pros and cons over buying a townhome vs buying townhome style condo. Will this property not generate as much as regular townhome ?

Anyone has dealt with Sorrento Toll brothers builders ? Any reccomondation on the place ?


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scott farmer, Agent, Scottsdale, AZ
Mon Jan 24, 2011
Toll Brothers are a good builder and you would probably be very happy with one of their homes. I'm not really sure how to address your question other than look closely at the fees of owning either style. Also, be aware that many times the HOA fees as we call them in AZ are often low in the beginning and can go up significantly when the builder completes the project in a year or so. Condo fees can be the cause of depressed property values if the fees are too high then price of the property stays lower. Hope this is food for thought.

Sandy Farmer
Realtor, GRI, CSSN
John Hall & Associates
1 vote
Arthur G. Wh…, Agent, Alameda, CA
Mon Jan 24, 2011
The issue is more about appreciation and the availability of loans when it is time to sell or refinance. Although the terms are not always clear in their usage, the real difference is whether the owner owns the land ( a planned unit development oir PUd) or just owns the the interior space with exclusive easements for the use of the land (condominium). This can be determined by examining the public record, but more importantly a valid title report from a title company. Two properties might look very similar in style, both might be called town homes, but their underpinning of the legal ownership could be quite different. Lenders are more willing to make loans on PUD's than on condos. The risk profile is different for them. Always read your title report and raise questions early.

Sales Manager Red Oak Realty
Broker Associate and Realtor®
Cal. DRE Lic. #01273793
1 vote
Gilbert Rich…, , Santa Clara County, CA
Sat Mar 5, 2011
Like I said before if it is between a property zoned as a condo or a townhome (PUD) buy the town home
0 votes
Amit Inamdar,…, Agent, Fremont, CA
Sun Feb 6, 2011
Typically there are condos and single family homes. Condos get classified into townhomes and apartment style condos. Then there are Pud-planned unit development. PUDs can be townhomes or single family homes. Depending on who is looking at your property the situation changes. PUDs are easy to finance over condos. Especially for low down payment Borrowers it's better to have a Pud rather than condo unless the condo project is approved by the lender or govt agency. Additionally if you are looking at buyer perception they prefer townhomes- that have only side neighbors and no above or below neighbors. Understandably why would someone live in similar apartment like property?

Hope this helps.
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Robert Chome…, , San Diego, CA
Sat Feb 5, 2011
I have found that the vast majority of time "townhouses" are classified the same condos buy lenders. If they are attached and have an HOA, then they have all the same restrictions as condos. The only time the financing is any better is if it is a PUD or a "site condo" (which most townhouses are not). A "site condo" means it is stand-alone and not attached to anything (but has an HOA). FHA loan guidelines do not have an restrictions for "site condos", the are financed just like SFR's.
0 votes
Gilbert Rich…, , Santa Clara County, CA
Sat Feb 5, 2011
Townhome all the way! Condos are harder to finance with far more financing restrictions than attached PUD's. This makes selling a huge problem in this market.

If the development is not Fannie Mae or FHA approved a buyer has to put 20% down just to buy from you. If there is condo litigation, more than 15% delinquent on the HOA financing is not possible either.
0 votes
Doug Buenz &…, Agent, Pleasanton, CA
Tue Jan 25, 2011
John -

The devil is in the details. "Townhouse" vs Condo in the lay world is generally referring to the style of property. A Condo style property is usually on one floor, with a neighbor above or below you, much like an apartment. A "townhouse" style unit is 2 or more floors. Some of the newer "townhouse" style properties can have someone above you or below you.

The distinction deals with the type of ownership. With a condo, you own the "airspace" of your unit, and the homeowners association owns the buildings. A townhouse is normally a "PUD" or planned unit development, and you actually own the ground beneath your unit as well as the unit itself. In the past few years this line has been blurred, and it seems most new developments have opted for the condominium type of ownership.

The biggest practical difference is in the maintenance of the units. On condos, the association is responsible for virtually all of the maintenance outside the unit, and possibly inside as well if there is a plumbing leak, etc. On PUD's, the owner is usually responsible for some of the exterior maintenance, and generally all of the interior maintenance.

The other distinction is with financing. To obtain an FHA loan on a condo, the condo complex must be approved by FHA, and not all of them are. On a PUD, the complex does not have to be approved by FHA to get an FHA loan.

Sorrento is a very nice community, and Toll Brothers has been good to work with in my experience. Check for resales in Sorrento, as there can be some pretty motivated sellers.

Good luck!

Doug Buenz
The 680 Group at Alain Pinel Realtors
(925) 463-2000
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0 votes
Nina Daruwal…, Agent, Cupertino, CA
Mon Jan 24, 2011
Hi John,
Just a few differences.....

A Townhome(TH), is just that. You own the land underneath, Share walls only on the sides, not above and below, and usually will have one or two garages attached, also can be a PUD(Planned Unit Development.)
In a Condo, or a Condo Style TH, you only own the Paint and Inside of the Home, NOT the Land it sits on!

For a Conventional Loan, for a TH, the Appraisal is done and is like one for a Single Family Home. The Interest Rate for a TH would also be slightly LOWER than that for a Condo/Condo STyle TH!
The Condo/Condo Style TH Appraisal would need additional Info like, How many Units in the Project, How many are Owner Occupied verses Renters, HOA Fees, Any HOA Delinquencies......a lot more conditions to be met!
For an FHA Loan, a TH is fine, whereas a Condo Project would need FHA Approval to be able to avail of an FHA Laon....
ALSO TH's hold better value than a CONDO Style Townhome, which Technically, and where Lenders are Concerned FOR SURE come under the CONDO Category.
And YES, Toll Brothers are Good Builders. If you want a referral for a good Realtor in DUBLIN, please do get in touch with me, I have a partner who works up there. Or I can help you. I just closed one in Danville!

Trust this helps, and gives you some info! All the Best,
Nina Daruwalla
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0 votes
Jill Landry, Agent,
Mon Jan 24, 2011
Toll Bros is a great builder and the Sorrento Dublin Ranch are nice. Are you asking as a investor or purchasing this as a owner occupied home? Are you asking to "generate" income or appreciation? I live in Dublin, if you have any questions please feel free to email or call or 925-999-9891
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